UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a)

of the Securities Exchange Act of 1934

(Amendment No. )

Filed by the Registrant 
       Filed by a Party other than the Registrant 

Check the appropriate box:

  Preliminary Proxy Statement

  
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14A-6(E)(2))

  Definitive Proxy Statement

  Definitive Additional Materials

  Soliciting Material Pursuant to
§240.14a-12

Humana Inc.

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check
the
appropriate box):

 No fee required.
Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
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LOGO  

Humana Inc.

500 West Main Street

Louisville, Kentucky 40202

 

 

 

LOGOLOGO

 

LOGO

LOGO

 

(Top Photo: Kurt Hilzinger;

Bottom Photo: Bruce Broussard)

  

Dear Fellow Stockholders:

 

We would like to invite you to attend the Annual Meeting of Stockholders of Humana Inc., to be held on Thursday, April 21, 2022,18, 2024, beginning at 9:30 a.m.1:00 p.m., Eastern Time in a virtual setting with live audio webcast that will be accessible at www.virtualshareholdermeeting.com/HUM2024. A recording of the Company’s headquarters, located at 500 West Main Street, 25th Floor Auditorium, in Louisville, Kentucky. The meetingAnnual Meeting will also be available through an audio-only webcast via the Internet on theour Investor Relations section ofwebsite within 48 hours after the Company’s website, www.humana.com.meeting. For further information on how to participate in the meeting, please refer to the “Frequently Asked Questions” section within this Proxy Statement.proxy statement.

 

This proxy statement contains information about our Company and the threesix proposals to be voted upon by stockholders at the meeting. Please give this information your careful attention.

 

This year, we will once again be taking advantage of U.S. Securities and Exchange Commission (SEC) rules that allow us to furnish proxy materials to our stockholders on the Internet. These materials will be available on the Internet on or about March 9, 2022.8, 2024. We continue to believe that Internet delivery of our proxy materials allows us to provide our stockholders with the information they need, while lowering the costs of delivery and reducing the environmental impact of our Annual Meeting.

 

We hope you can attend the meeting. However, even if you are unable to join us, we urge you to still exercise your right as a stockholder and vote by telephone, mail or using the Internet. The vote of every stockholder is important.

 

This proxy statement is being mailed or transmitted on or about March 9, 2022,8, 2024, to our stockholders of record as of February 28, 2022.29, 2024.

2023 Reflections

 

For our Company and our stakeholders, 2023 was a dynamic and challenging year as we found ourselves responding to significant and unanticipated increase in medical cost trends in the Medicare Advantage (MA) industry. Throughout the year, we leveraged our commitment to cost discipline, working tirelessly to offset the impact of these trends through areas such as administrative cost containment and productivity initiatives. Despite our efforts, we were ultimately unable to fully offset these trends as they continued to accelerate in the fourth quarter, resulting in 2023 earnings growth that failed to meet our expectations. Like you, we were disappointed in the Company’s closing financial performance. Still, we do not want this setback to overshadow the advancement of our long-term strategy in 2023 - achieving strong growth in our individual MA, Medicaid and CenterWell businesses, progress made across the enterprise to grow our industry leading MA and senior focused value-based care platforms and maintain our industry leading quality and customer satisfaction scores to name just a few.

Insurance. The strength of our core insurance operations remains clear. In 2023, we grew our individual MA membership by over 840,000, and continued our leadership in putting members first - evidenced again in our strong Star Ratings for 2024, with 94 percent of our members in plans rated 4 stars or higher, 61 percent in plans rated 4.5 or 5 stars, and 37 percent of all 5-star MA membership in a Humana plan. And our strong organic Medicaid growth continues - we implemented contracts in Ohio and Louisiana in 2023 and look forward to beginning to serve members in both Indiana and Oklahoma in 2024 - reflecting our strong operating model and ability to deliver unique value to communities.

CenterWell.The growth of both our primary care and value-based home health businesses continues. In primary care, we now operate nearly 300 centers serving over 294,000 patients, which represents year over year growth of 26 percent and 19 percent, respectively. And we have further expanded our value-based home care models, now covering 843,500 of our MA members under a value-based payment model covering home health, DME and infusion services. And with this growth, we continue to unlock opportunities for our health plan members to utilize our healthcare services assets, which leads to better outcomes, greater satisfaction, and higher customer retention.

As your Board of Directors, we take our responsibilities very seriously and are committed to representing our stockholder’s interests to deliver sustainable results over the long-term. As the Company continues to navigate a complex and dynamic period of change in the MA industry in the near-term, we still believe in the strong fundamentals and significant value proposition of MA and remain focused on both margin recovery and advancing our industry leading MA and senior focused value-based care platforms to position the Company for long-term success. At the same time, the Board continues to observe comprehensive corporate governance practices, working together closely as we execute on our CEO transition plan, engaging with stockholders to understand and be responsive to your perspectives, and providing active oversight to assist the Company in advancing its strategic vision.

On behalf of the Board, thank you for your investment and continued confidence in Humana’s success.

 

2021 Reflections

For our Company and our stakeholders, 2021 was a year of transition as we continued to navigate the ongoing health, social and economic challenges caused by the global pandemic. We faced these challenges head on, actively responding to issues at every turn, to ensure the holistic needs of our members were met and that our Company remained a leader in the Medicare Advantage industry. Throughout the year, our Company’s core operations remained strong and we continued to advance our strategy to become an innovative integrated healthcare Company that has the power to help the millions of individuals we serve achieve their best health.

We are creating significant value by driving growth in our top-tier Medicare Advantage business while also organically expanding our Medicaid footprint, increasing the contribution from our Healthcare Services businesses, and delivering ongoing cost efficiencies and productivity improvements across the Company. We are operating from a position of strength and are confident in our enterprise strategy, the fundamentals of the Medicare Advantage industry, and our ability to deliver significant and sustainable long-term value for our customers and stockholders. We’ve seensuccess among our core businesses – Medicare Advantage, Medicaid, Pharmacy, Primary Care and Home Solutions – through strategic initiatives and technological advancements that have enhanced customer experiences and contributed to improved health outcomes. These successes are empowering us to pursue continued innovations with confidence as we maintain our effort to shift from an insurance company with elements of health to a health company with elements of insurance.

We are incredibly proud that Humana is the second largest Medicare Advantage health plan provider, supporting over 5 million beneficiaries with products that offer the highest quality among our public peers, as recognized by our Medicare Advantage plan Star ratings, and continued investment and growth in our Medicare Advantage business remains a key priority. We also continue to advance our consumer segmentation efforts, developing plans that are tailored to the unique needs of specific member populations, such as growing our dual eligible special needs plan (D-SNP) membership. Expansion of our Medicaid business remains a strategic priority as we’re able to offer states an individualized approach to care that considers the physical and mental well-being of beneficiaries, as well as the critical social determinants that impact the population. Our Healthcare Services businesses are an important component of our strategy and will contribute considerably to our long-term growth. Combining our leading Medicare Advantage platform with our growing Pharmacy, Primary Care and Home Solutions businesses increases our total addressable market and creates the opportunity for improved clinical outcomes, lower cost of care and increased enterprise margin from our health plan members.

Looking ahead, we are encouraged and energized by opportunities for our Company to continue leading the way in addressing health, wellness, social and economic needs of all our stakeholders. By leveraging core fundamentals of our business and maintaining strategic investments within our enterprise, we are confident in our ability to remain a leader in the Medicare Advantage industry, driving improved membership growth in 2023, while continuing to deliver on our long-term adjusted earnings growth target. We extend our sincere appreciation to our associates, members and patients, clinician partners, government partners and our stockholders for your continued support, trust, contribution and belief in the success of our Company.

  

LOGO

Kurt J. Hilzinger

Chairman of the Board

and Stockholder

 

March 9, 20228, 2024

 

  

LOGO

 

Bruce D. Broussard

Director, President and Chief Executive Officer

and Stockholder

 

March 9, 20228, 2024


LOGO

Notice of 20222024 Annual Meeting of Stockholders

 

 

Time and Date:  9:30 a.m.1:00 p.m., Eastern Time, on Thursday, April 21, 202218, 2024
Location:  Humana Inc. headquarters, located at 500 West Main Street, 25th Floor Auditorium, in Louisville, Kentuckywww.virtualshareholdermeeting.com/HUM2024
Agenda:  

1.  Elect the thirteen (13)eleven (11) director nominees named in the proxy statement.

 

2.  Ratify the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for 2022.2024.

 

3.  Non-binding advisory vote to approve the compensation of the Company’s Named Executive Officers.

 

4.  Approve amendment to the Company’s Restated Certificate of Incorporation to limit the liability of certain officers of the Company as permitted by Delaware law.

5.  Approve amendment to the Company’s Restated Certificate of Incorporation to eliminate supermajority voting requirement in connection with certain transactions.

6.  Consider and vote upon the stockholder proposal set forth in this proxy statement, if properly presented at the meeting.

7.  Consider any other business properly brought before the meeting.

Record Date:  February 28, 2022.29, 2024. Humana stockholders of record at the close of business on that date will be entitled to vote.
Proxy Voting:  

Your vote is important so that as many Shares as possible will be represented. Please vote by one of the following methods:

 

  BY INTERNET

 

  BY TELEPHONE

 

  BY RETURNING YOUR PROXY CARD (if you elected to receive printed materials)

 

  BY VOTING DURING THE ANNUAL MEETING (for in person attendance only)

 

See instructions on your proxy card or at the voting site (www.proxyvote.com).

By Order of the Board of Directors,

 

 

LOGO

Joseph M. Ruschell

Associate Vice President, AssistantAssociate General Counsel & Corporate Secretary

March 9, 20228, 2024


Table of Contents

 

 


Proxy Summary

 

General Information

 

Meeting:

  20222024 Annual Meeting of Stockholders Place:  Humana Inc. Headquarterswww.virtualshareholdermeeting.com/HUM2024

Date:

  Thursday, April 21, 202218, 2024   500 West Main Street

Time:

  9:30 a.m.1:00 p.m., Eastern Time   25th Floor Auditorium

Record Date:

 

  February 28, 202229, 2024   Louisville, KY 40202

How to Vote Your Shares

You may vote if you were a stockholder as of the close of business on February 28, 2022.29, 2024.

 

LOGO  

Online

www.proxyvote.com

 LOGO  

By Mail

Complete, sign, date, and return your proxy card

in the envelope provided

LOGO  

By Phone

Call the phone number located on the top

of your proxy card

 LOGO  

During the Meeting

Attend our virtual annual meeting and cast your vote in personusing the webcast voting options

Voting Overview

 

Items of Business

Items of Business

Items of Business

Items of Business

  Board
Recommendation
  

Page

  Reference  

  

Board
Recommendation

 

   

 

  

Page  

Reference  

 

1.

  

Elect the thirteen (13) director nominees named in the proxy statement.

 

  FOR

 

  30

 

  

 

Elect the eleven (11) director nominees named in the proxy statement.

 

  

 

FOR

 

   4  

 

 

2.

  

Ratify the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for 2022.

 

  FOR  82  

Ratify the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for 2024.

 

  FOR   85  

3.

  

Non-binding advisory vote to approve the compensation of the Company’s Named Executive Officers.

 

  FOR  83  

Non-binding advisory vote to approve the compensation of the Company’s Named Executive Officers.

 

  FOR   86  

4.

  

Consider any other business properly brought before the meeting.

 

 

      

Approve amendment to the Company’s Restated Certificate of Incorporation to limit the liability of certain officers of the Company as permitted by Delaware law.

 

  FOR   87  

5.

  

Approve amendment to the Company’s Restated Certificate of Incorporation to eliminate supermajority voting requirement in connection with certain transactions.

 

 

  FOR   89  

6.

  

Consider and vote upon the stockholder proposal set forth in this proxy statement, if properly presented at the meeting.

 

 

  AGAINST   91  

7.

  

Consider any other business properly brought before the meeting.

 

 

        

Board of Directors Nominees

 

   
 Name  Position  Age    First Elected Director 

Kurt J. Hilzinger

  

Chairman of the Board, Independent Director

  

6163  

 

07/2003

Bruce D. Broussard

  

Director, President and Chief Executive Officer

  

5961  

 

01/2013

Raquel C. Bono, M.D.

  

Independent Director

  

6567  

 

09/2020

Frank A. D’Amelio

  

Independent Director

  

6466  

 

09/2003

David T. Feinberg, M.D.

  

Independent Director

  

5961  

 

03/2022

Wayne A.I. Frederick, M.D. 

  

Independent Director

  

5052  

 

02/2020

John W. Garratt

  

Independent Director

  

5355  

 

02/2020

David A. Jones, Jr.

Independent Director

64    

05/1993

Karen W. Katz

  

Independent Director

  

6567  

 

09/2019

Marcy S. Klevorn

  

Independent Director

  

6264  

 

02/2021

William J. McDonald

Independent Director

65    

10/2007

Jorge S. Mesquita

  

Independent Director

  

6062  

 

02/2021

James J. O’BrienBrad D. Smith

  

Independent Director

  

6759  

 

04/200609/2022

 

i  

Humana | 20222024 Proxy Statement Proxy Summary


Frequently Asked Questions

Why am I receiving this Proxy Statement?

You are receiving a proxy statement because you owned Humana Inc. common stock, which we refer to as Shares, as of Monday, February 28, 2022, which we refer to as the Record Date, and that entitles you to vote at the Annual Meeting. Our Board of Directors has made these materials available to you on the Internet or, upon your request, has delivered printed versions of these materials to you by mail, in connection with the Board’s solicitation of proxies on behalf of the Company for use at our 2022 Annual Meeting of Stockholders. Your proxy will authorize specified people (proxies) to vote on your behalf at the Annual Meeting. By use of a proxy, you can vote, whether or not you attend the meeting.

This proxy statement describes the matters on which the Company would like you to vote, provides information on those matters, and provides information about the Company that we must disclose when we solicit your proxy.

Why did I receive a one-page notice in the mail regarding the Internet availability of proxy materials instead of a full set of proxy materials?

Pursuant to rules adopted by the SEC, we have elected to provide access to our proxy materials over the Internet. We believe that Internet delivery of our proxy materials allows us to provide our stockholders with the information they need, while lowering the costs of delivery and reducing the environmental impact of our Annual Meeting. Accordingly, we are sending a Notice of Internet Availability of Proxy Materials, which we refer to as the Notice, to our stockholders and beneficial owners as of the Record Date. All stockholders will have the ability to access the proxy materials on a website referred to in the Notice or request to receive a printed set of the proxy materials. Instructions on how to access the proxy materials over the Internet or to request a printed copy may be found on the Notice. In addition, stockholders may request to receive proxy materials in printed form by mail or electronically by e-mail on an ongoing basis by calling Broadridge Financial Solutions, Inc., or Broadridge, at 1-800-579-1639.

How can I get electronic access to the proxy materials?

The Notice provides you with instructions regarding how to:

View our proxy materials for the Annual Meeting on the Internet; and

Instruct us to send our future proxy materials to you electronically by e-mail.

Choosing to receive your future proxy materials by e-mail will save us the cost of printing and mailing documents to you and will reduce the impact of our Annual Meetings on the environment. If you choose to receive future proxy materials by e-mail, you will receive an e-mail next year with instructions containing a link to those materials and a link to the proxy voting site. Your election to receive proxy materials by e-mail will remain in effect until you terminate it.

When and where is the Annual Meeting?

The Annual Meeting will be held on Thursday, April 21, 2022, at 9:30 a.m., Eastern Time, at the Company’s headquarters, located at 500 West Main Street, 25th Floor Auditorium, in Louisville, Kentucky.

Who is entitled to vote?

Anyone who owns Shares, as of the close of business on February 28, 2022, the Record Date, is entitled to vote at the Annual Meeting or at any later meeting should the scheduled Annual Meeting be adjourned or postponed for any reason. As of the Record Date, 126,743,282 Shares were outstanding and entitled to vote. Each Share is entitled to one vote on each of the matters to be considered at the Annual Meeting.

Frequently Asked Questions  2022 Proxy Statement  |  Humana

1


What will I be voting on?

Election of the thirteen (13) director nominees named in this proxy statement to serve on the Board of Directors of the Company;

Ratification of the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for 2022; and

A non-binding, advisory vote to approve the compensation of the Company’s Named Executive Officers as disclosed in this proxy statement.

The Board of Directors is not aware of any other matters to be presented for action at the Annual Meeting. However, if other matters are properly presented for a vote, the proxies will be voted for these matters in accordance with the judgment of the persons acting under the proxies.

How does the Board recommend I vote on each proposal?

The Board recommends that you vote your Shares as follows:

FOR the election of each of the thirteen (13) director nominees named in this proxy statement;

FOR the ratification of the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for 2022; and

FOR the approval of the compensation of the Company’s Named Executive Officers as disclosed in this proxy statement.

All Shares that are represented at the Annual Meeting by properly executed proxies received before or at the Annual Meeting and not revoked will be voted at the Annual Meeting in accordance with the instructions indicated in the proxies.

How do I participate in the Annual Meeting?

This year’s Annual Meeting will be held in-person at the Company’s headquarters located at 500 West Main Street, 25th Floor Auditorium, in Louisville, Kentucky. The Company will also provide a live audio-only webcast of the Annual Meeting via the Internet on the Investor Relations section of the Company’s website (www.humana.com). You are entitled to participate in the Annual Meeting if you were a stockholder as of the close of business on the Record Date, or hold a valid proxy for the meeting. If you decide to attend the Annual Meeting by webcast, you will be able to listen to the Annual Meeting but will not have the ability to vote your shares or ask questions during the Annual Meeting. Conversely, if you are attending in-person, you will have the ability to ask questions and vote your Shares during the Annual Meeting. The Company will provide Rules of Conduct for the Annual Meeting which can be obtained at www.proxyvote.com after logging in with your unique 16-digit control number provided on your Notice of Internet Availability of Proxy Materials, your proxy card or your voting instruction form that accompanied your proxy materials (your “Control Number”). The Rules of Conduct will be strictly adhered to during the Annual Meeting.

If you are a beneficial stockholder, you may contact the bank, broker or other institution where you hold your account if you have questions about obtaining your Control Number. Non-stockholders are welcome to attend the Annual Meeting, however guests will not be allowed to participate during the Annual Meeting except as listeners.

A question and answer (Q&A) session will be available to stockholders during the Annual Meeting and will include questions submitted in advance of, and questions asked in person during, the Annual Meeting. You may submit a question in advance of the meeting at www.proxyvote.com after logging in with your Control Number. Questions may be submitted in person during the Q&A session of the Annual Meeting. The Company’s Corporate Secretary will review all questions submitted in advance to ensure that those presented for response are in accordance with the Rules of Conduct.

How do I vote?

There are four ways that you can vote your Shares. Voting by any of these methods will supersede any prior vote you made regardless of how that vote was made. PLEASE CHOOSE ONLY ONE OF THE FOLLOWING:

1)

By Internet.  The website for voting is www.proxyvote.com. In order to vote on the Internet, you need the Control Number on your proxy card. Each stockholder has a unique control number so we can ensure all voting instructions are genuine and prevent duplicate voting. The Internet voting system is available 24 hours a day, seven days a week, until 11:59 p.m., Eastern Time, on

2

Humana  |  2022 Proxy Statement  Frequently Asked Questions


Wednesday, April 20, 2022, the day before the Annual Meeting. Once you are logged on the Internet voting system, you can record and confirm (or change) your voting instructions. If you use the Internet voting system, you do not need to return your proxy card.

2)

By Telephone.  If you are a registered holder in the United States or Canada, you may call 1-800-690-6903. The telephone voting system is available 24 hours a day, seven days a week, until 11:59 p.m., Eastern Time, on Wednesday, April 20, 2022, the day before the Annual Meeting. In order to vote by telephone, you need the Control Number on your proxy card. Each stockholder has a unique Control Number so we can ensure all voting instructions are genuine and prevent duplicate voting. Once you are logged on the telephone voting system, a series of prompts will tell you how to record and confirm (or change) your voting instructions. If you use the telephone voting system, you do not need to return your proxy card.

3)

By Mail.  Mark your voting instructions, sign and date the proxy card and then return it in the postage-paid envelope provided. If you mail your proxy card, we must receive it before 12:00 p.m., Eastern Time, on Friday, April 15, 2022. If you are returning your proxy card to Broadridge, they must receive it before 10:00 a.m., Eastern Time, on Wednesday, April 20, 2022, the day before the Annual Meeting.

4)

In person.  Attend the Annual Meeting. Mark your voting instructions and deliver the proxy card to the Inspectors of Election. Be aware that you can vote by methods 1, 2 or 3 above prior to the meeting and still attend the Annual Meeting. In all cases, a vote at the Annual Meeting will revoke any prior votes. Please note that if your Shares are held through a bank, broker or other nominee, you will need to obtain your Control Number in order to vote.

How will my Shares be voted if I do not specify how they should be voted?

If you sign and return your proxy card without indicating how you want your Shares to be voted, the persons acting under the proxies will vote your Shares as follows:

FOR the election of each of the thirteen (13) director nominees named in this proxy statement;

FOR the ratification of the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for 2022; and

FOR the approval of the compensation of the Company’s Named Executive Officers as disclosed in this proxy statement.

What if my Shares are not registered in my name?

If you own your Shares in “street name,” meaning that your bank, broker or other nominee is actually the record owner, you should receive the Notice and voting instruction card from your bank, broker or other nominee. In addition, stockholders may request, by calling Broadridge at 1-800-579-1639, to receive proxy materials in printed form, by mail or electronically by e-mail, on an ongoing basis. When you own your Shares in street name, you are deemed a beneficial owner or holder for voting purposes and you may not vote your Shares at the Annual Meeting unless you receive a valid proxy from your brokerage, firm, bank, broker-dealer or other nominee holder.

If you hold Shares through an account with a bank, broker or other nominee and you do not provide voting instructions on your instruction form, your Shares may not be voted by the nominee with respect to certain proposals, including:

the election of directors;

the approval of the compensation of the Company’s Named Executive Officers as disclosed in this proxy statement; and

the frequency with which future non-binding advisory stockholder votes on the compensation of the Company’s Named Executive Officers will be held.

Banks, brokers and other nominees have the authority under the regulations of the New York Stock Exchange, or the NYSE, to vote Shares for which their customers do not provide voting instructions only on certain “routine” matters, including the ratification of the appointment of the Company’s independent registered public accounting firm. However, the proposals listed above are not considered “routine” matters for this purpose, and therefore your Shares will not be voted with respect to such proposals if you do not provide voting instructions on your instruction form.

Frequently Asked Questions  2022 Proxy Statement  |  Humana

3


How many votes are required to approve each proposal, what are the effects of abstentions and unmarked proxy cards, and is broker discretionary voting allowed?

Proposal

Vote Required for

Approval

Effect of

    Abstentions    

Broker

    Discretionary    

Voting
Allowed
(2)

    Unmarked/Signed    

Proxy Cards

Election of directors

The number of votes
cast for a nominee

exceeds the number
of votes cast against
that nominee.(1)

No effectNo

Voted “For”

All Directors

Ratification of the
appointment of the

independent registered

public accounting firm

Majority of shares
present and entitled
to vote
Counted as “Against”YesVoted “For”

Non-binding advisory vote

to approve executive

compensation

Majority of shares

present and entitled

to vote

Counted as “Against”NoVoted “For”

(1)

Under the Company’s Majority Vote Policy, following election to our Board of Directors, a director is required to submit his or her irrevocable resignation to our Board of Directors conditioned upon (a) the director not achieving the requisite stockholder vote at any future meeting at which he or she faces re-election, and (b) acceptance of the resignation by the Board of Directors following that election. The Board of Directors has 90 days after a director fails to achieve the requisite stockholder votes to determine whether or not to accept the director’s resignation and to report this information to our stockholders.

(2)

If you are a beneficial owner whose Shares are held of record by a broker or other NYSE member organization, you must instruct the broker how to vote your Shares. If you do not provide voting instructions, your Shares will not be voted on any proposal on which the broker does not have discretionary authority to vote. This is called a “broker non-vote.” A broker non-vote will not affect the outcome of the vote for the matters being presented for action at the Annual Meeting, because they are not considered to be votes cast.

What is a “broker non-vote”?

A broker non-vote occurs when a broker or other NYSE member organization holding Shares for a beneficial owner does not vote on a particular proposal because the nominee does not have discretionary voting power with respect to that item and has not received voting instructions from the beneficial owner, but does have discretionary voting power over other items and submits votes for those matters. As discussed above, if you hold Shares through a broker or other NYSE member organization and do not provide voting instructions to your broker or other NYSE member organization, your Shares may not be voted with respect to certain proposals, including the proposals listed above that are not considered routine.

What is a “quorum”?

A “quorum” is a majority of the issued and outstanding Shares entitled to vote at the Annual Meeting. Shares may be voted at the Annual Meeting by a signed proxy card, by telephone instruction, or electronically on the Internet. There must be a quorum for the Annual Meeting to be held. Abstentions and broker non-votes are counted as present and entitled to vote for purposes of determining whether a quorum exists.

4

Humana  |  2022 Proxy Statement  Frequently Asked Questions


How do I vote the share equivalent units held in the Humana Common Stock Fund of the Humana Retirement Savings Plan or the Humana Puerto Rico Retirement Savings Plan?

If you have an interest in the Humana Common Stock Fund of the Humana Retirement Savings Plan or the Humana Puerto Rico Retirement Savings Plan on the Record Date, you may vote. Under the Humana Retirement Savings Plan and the Humana Puerto Rico Retirement Savings Plan, your voting rights are based on your interest, or the amount of money you and the Company have invested in your Humana Common Stock Fund.

You may exercise these voting rights in almost the same way that stockholders may vote their Shares, but you have an earlier deadline, and you should provide your voting instructions to Broadridge. Broadridge will aggregate the votes of all participants and provide voting information to the Trustee for the applicable plan. If your voting instructions are received by 11:59 p.m., Eastern Time, on Wednesday, April 13, 2022, the Trustee will submit a proxy that reflects your instructions. If you do not give voting instructions (or give them later than that time), the Trustee will vote your interest in the Humana Common Stock Fund in the same proportion as the Shares attributed to the Humana Retirement Savings Plan, or the Humana Puerto Rico Retirement Savings Plan, as applicable, are actually voted by the other participants in the applicable plan.

You must provide your instructions to Broadridge by using the Internet, registered holder telephone number (1-800-690-6903) or mail methods described above. Please note that you cannot vote during the Annual Meeting. Your voting instructions will be kept confidential under the terms of the Humana Retirement Savings Plan or the Humana Puerto Rico Retirement Savings Plan, as applicable.

Who will count the votes?

Broadridge will tabulate the votes cast by proxy, whether by proxy card, Internet or telephone. Additionally, the Company’s Inspectors of Election will tabulate the votes cast at the Annual Meeting together with the votes cast by proxy.

How do I change my vote or revoke my proxy?

You have the right to change your vote or revoke your proxy at any time before the Annual Meeting.

Your method of doing so will depend upon how you originally voted (a later vote will supersede any prior vote you made regardless of how that vote was made):

1)

In Person — simply vote in person at the Annual Meeting;

2)

By Internet — simply log in and resubmit your vote — Broadridge will only count the last instructions;

3)

By Telephone — simply sign in and resubmit your vote — Broadridge will only count the last instructions;

4)

By Mail — you must give written notice of revocation to Broadridge, 51 Mercedes Way, Edgewood, NY 11717 or by fax at 1-515-254-7733, submit another properly signed proxy with a more recent date. For written and fax notices, you must include the Control Number that is printed on the upper portion of your proxy card.

What is the due date for stockholder proposals, including stockholder nominees for director, for inclusion in the Company’s proxy materials for the 2023 Annual Meeting?

Stockholder proposals, or stockholder nominees for director at the 2023 Annual Meeting, as permitted by SEC regulations for inclusion in our proxy materials relating to the 2023 Annual Meeting, must be submitted to the Corporate Secretary in writing no later than November 9, 2022. Proposals should be submitted to the attention of the Corporate Secretary, Humana Inc., 500 West Main Street, 21st Floor, Louisville, Kentucky 40202. Further, to comply with the universal proxy rules (once effective), stockholders who intend to solicit proxies in support of director nominees other than the Company’s nominees must provide notice that sets forth the information required by Rule 14a-19 under the Exchange Act no later than February 20, 2023.

Frequently Asked Questions  2022 Proxy Statement  |  Humana

5


May a stockholder present a proposal not included in our Proxy Statement at the April 21, 2022, Annual Meeting?

A stockholder can present a proposal at the Annual Meeting (a so-called “floor resolution”) only if certain notice requirements are met. The SEC does not directly regulate meeting conduct. State law imposes only limited requirements, so meetings are governed by procedures set forth in our Amended and Restated Bylaws (the “Bylaws”). Humana’s Bylaws require that a stockholder provide written notice of intent to bring a proposal no less than 60 days or more than 90 days prior to the scheduled date of the Annual Meeting of stockholders. If less than 70 days’ notice of the Annual Meeting is given, written notice by a stockholder would be deemed timely if made no later than the 10th day following such notice of the Annual Meeting. A proposal must also meet other requirements as to form and content set forth in our Bylaws. Stockholder proposals should be sent to the attention of the Corporate Secretary, Humana Inc., 500 West Main Street, 21st Floor, Louisville, Kentucky 40202. A copy of our Bylaws is available on our website. From the www.humana.com website, click on “Investor Relations,” and then click on “Corporate Governance” subcategory and then click on the link entitled, “Bylaws.”

How will Humana solicit votes and who pays for the solicitation?

We have engaged D. F. King & Co., Inc. to assist in the distribution of proxy materials and solicitation of votes for approximately $13,000 plus expenses. We have also engaged Broadridge to assist in the distribution of proxy materials and the accumulation of votes through the Internet, telephone and coordination of mail votes for approximately $321,350 plus expenses. We will reimburse banks, brokers and other nominees for their reasonable out-of-pocket expenses for forwarding proxy and solicitation material to our stockholders.

How can I obtain additional information about the Company?

Included with this proxy statement (either in printed form or on the Internet) is a copy of our Annual Report on Form 10-K for the year ended December 31, 2021, which also contains the information required in our Annual Report to Stockholders. Our Annual Report on Form 10-K and all our other filings with the SEC also may be accessed via the Investor Relations section on our website at www.humana.com. We encourage you to visit our website. From www.humana.com click on “Investor Relations,” then click on the “SEC Filings and Financial Reports,” then click on the “Annual Reports” subcategory.

Where can I find voting results for this Annual Meeting?

The voting results will be published in a current report on Form 8-K which will be filed with the SEC no later than four business days after the Annual Meeting. The Form 8-K will also be available on our website. From the www.humana.com website, click on “Investor Relations,” then click on “SEC Filings and Financial Reports,” and then click on “SEC Filings” subcategory.

What is “householding”?

“Householding” occurs when a single copy of our Annual Report, proxy statement and Notice is sent to any household at which two or more stockholders reside if they appear to be members of the same family. Although we do not “household” for registered stockholders, a number of brokerage firms have instituted householding for Shares held in street name. This procedure reduces our printing and mailing costs and fees. Stockholders who participate in householding will continue to receive separate proxy cards, and householding will not affect the mailing of account statements or special notices in any way. If you wish to receive separate copies of our Annual Report, proxy statement or Notice in the future, please contact the bank, broker or other nominee through which you hold your Shares.

6

Humana  |  2022 Proxy Statement  Frequently Asked Questions


Company Overview

 

Headquartered in Louisville, Kentucky, Humana Inc. (NYSE: HUM) is a leading (2021 Fortune #41 ranking) health and well-being company focused on making it easy for people to achieve their best health with clinical excellence through coordinated care. We operate under two distinct segments: Insurance and CenterWell – a simple structure that we believe creates greater collaboration across the Insurance and CenterWell businesses and will accelerate work to centralize and integrate operations within the organization. Our strategy integrates care delivery, the member experience, and clinical and consumer insights to encourage engagement, behavior change, proactive clinical outreach and wellness for the millions of people we serve across the country. As of December 31, 2021,2023, we had approximately 17.116.9 million members in our medical benefit plans, as well as approximately 5.34.9 million members in our specialty products.

Our Strategy

We are committed to addressing the most important health needs of our millions of medical and specialty insurance members and health services patients. Our Insurance segment delivers products that aim to provide affordable, high-quality access to medical, dental, hearing, vision, and prescription drug care to our members. Our CenterWell segment delivers health services to customers to simplify achieving betterfrom a variety of payors, including Humana, in what we consider the most significant areas of influence for managing chronic conditions and total cost of care. These include primary care, home health, and give our customers more healthy days. We offer insurancepharmacy solutions. Together these offerings, underpinned by leading data, analytics, clinical quality, and non-insurance productscommercial capabilities, enable us to consumers through our various subsidiaries. Our medical and specialty insurance products allow members to access health care services primarily through our networks of health care providers with whom we have contracted. In addition, we offer pharmacydeliver solutions provider services, home solutions services and other services and capabilities tothat promote wellness and advance population health.

Our successfulThe core franchise of our business is Medicare Advantage, which is one of the fastest growing and most attractive segments of healthcare. We aim to sustainably and profitably grow this business over the long-term by leveraging several differentiated capabilities in our Insurance segment, including our leadership in value-based care arrangements, our leading clinical quality as evidenced by our consistently high Star Ratings performance, our first-mover advantage in interoperability, data, and analytics solutions, and our award-winning customer experience. We also have an attractive diversification of insurance offerings across product offerings (medical, dental, vision, hearing, prescription drug), and customer segments (Medicare Advantage, Medicaid, and Military). We also realize that in our complex industry effective partnership is required to meet the needs of our diverse customers. We have a proud history inof partnering with multiple stakeholders, including our government partners at the Centers for Medicare & Medicaid Services (CMS), state insurance and Medicaid administrations, distribution and channel partners, care delivery providers, technology companies, and retailers to name just a few.

Our CenterWell segment includes health service offerings of significant scale and scope across primary care, home health, and pharmacy solutions. These capabilities are poised to benefit from secular tailwinds and become an increasingly important piece of the enterprise’s overall revenue and profitability profile. These businesses also expand our addressable market by serving patients from multiple health plans and Original Medicare in addition to Humana health plan administration is helpingmembers. And most importantly, these businesses enable us to participate directly in the areas of highest influence for successful proactive management of disease progression. As a result, we are able to lower avoidable hospital admissions (and readmissions) and lower inappropriate ER utilization while improving net promoter score (NPS) and quality scores relative to competitive benchmarks.

While our businesses have attractive revenue, margin, and growth profiles in their own right, the collection of assets we’ve assembled at meaningful scale position us to create a new kind of integrated care delivery system with the power to address our customers’ most significant needs that impede simpler health care and better health by (i) making care more predictable, understandable, and affordable, (ii) addressing medical, behavioral, and social needs, and (iii) delivering care whenever and wherever our customers need it. Our efforts are leading to a better quality of life for people with Medicare, families, individuals, military service personnel, and communities at large. Humana’s innovative strategy continues to capitalize on industry changes by positioning ourselves as a partner in health and aging to our consumers. We understand that health care is complicated and dealing with multiple physicians and other health care professionalsnavigating the system can be a confusing and daunting task. This is particularly true for vulnerable populations, which tend to over index in the markets we serve. That is one of the principal reasons why Humana continues to enhance its integrated care delivery strategy in key areas to enable a better and more seamless locally delivered health care experience for our members.

We also understand we operate in an increasingly competitive environment, and as such, we are focusingcontinually focused on better understanding and addressing the unmet needs that matter the most to our customers, aligning our actions and behaviors to go above and beyond to solve those needs and deliver on a “more human” experience, so people get more than they expect, ultimately helping members achieve their best health.customers. We call this delivering “human care.” Human care separates Humana from other traditional insurancehealthcare companies, demonstrating that our approach is more caring, personalized, and easier.simple. We do this by (i) listening to our customers, (ii) establishing strong partnerships with trusted individuals who are involved in their care, such as providers and caregivers, (iii) developing technologies and other solutions that offer convenient and easy ways for them to engage with their health, and (iv) leveraging data, analytics, and digital solutions to improve how they engage and interact with usus.

Finally, we aim to be responsible stewards, driven by personalizingsustainable organic growth, expense discipline, and accretive M&A. We also plan to continue to innovate with our government partners to advance the experience for how they want to interact with Humana.

Our ecosystem of value-based care delivery capabilities engages our customers clinically by focusing on the physical, mental,Medicare Advantage and preventative aspects of their health, and delivering better health outcomes. We activate a network of proprietary and partnered solutions, focusing specifically on the highest influence touchpoints of the health care delivery system, including primary care, home health, pharmacy, behavioral health, and social determinants of health. We support the integration of these touchpoints through robust data, analytics, and digital health capabilities that help us engage our customers in their health and get them the right care, in the right place, at the right time. This approach allows usMedicaid programs to deliver better quality and healthgreat outcomes while making the health care experience simpler for our members and patients.

Our Continued COVID-19 Response

Throughout 2021,patients and great value to the COVID-19 pandemic continued to present unique challenges that highlighted our commitment to quality, the strengthstaxpayer in one of the Medicare Advantage (MA) program,finest examples of public/private partnership in the country. And last, and the value that this enduring public-private partnership bringsmost fundamental to our nation’s seniors,strategy, is the disabled andcontinual focus on nurturing the healthcare system as a whole. Early in the year, we activated our teams to support our members in getting vaccinated, leveraging our data, analytics and clinical capabilities to engage in proactive outreach to help our members schedule appointments, partnering with retail organizations, providers and the communities we serve in setting up vaccine clinics, and ensuring that underserved populations had equal opportunities to access the vaccines. As the year progressed, we continued to adapt to address our members’ needs, providing resources regarding the safety and efficacyculture of the vaccines, reducing financial barriers to care, further improving access to telephonicCompany and in-home care and screening capabilities, supporting our members in receiving in-person care, and addressing social determinants of health needs that were exacerbated by the pandemic.

These efforts and our performance in 2021 were made possible by the ongoing, tireless effortsengagement of our associates, who continuedwhich power all of our efforts to put ourdeliver the best health and simplest experience possible for the members and patients at the front of everything we do while continuingare privileged to balance the daily challenges presented by the pandemic.serve.

 

Company Overview  2022 2024 Proxy Statement | Humana

 

     71



LOGO

Our Values

As our industry has evolved, so has our Company, and our values reflect who we are today. While we have always been grounded in our purpose of helping people, we introduced “health first” in 2023 as our evolved purpose, unifying us in our mission of providing simple, personalized and integrated care to all those we serve. It guides our actions as we execute on our strategy and gives us an edge in a competitive environment. When we do it well, our business thrives, our associates are engaged and our customers experience human care. 

LOGOLOGOLOGO

Our purpose comes alive in clear and simple values that are expressed in unique ways each day. By being caring, curious and committed, our associates reflect who we are and how we show up each day. These values drive behaviors that help our associates put health first for themselves, each other and the people they serve.

LOGO

LOGO

LOGO

Caring

Curious

Committed

Create an environment where people feel valued, respected and are treated with kindness.Work and learn together creating the best solutions for the people we serve.To fulfill our purpose, take bold action to impact the lives of people and transform the healthcare industry.

•  Empathize and actively listen

•  Build trust, safety and equitable opportunities

•  Care for the whole person

•  Pursue diverse perspectives

•  Create value through innovating simple, quality experiences

•  Integrate our work across the enterprise

•  Deliver our commitments with excellence

•  Be a good steward of our resources and time

•  Elevate our agility

2

Humana | 2024 Proxy Statement Company Overview


Our Performance

Our 20212023 performance reflected the emergence of a complex and dynamic period of change in the Medicare Advantage industry. While we made strong progress in advancing our senior focused, value-based care platforms and positioning the Company for success over the long-term, we were also confronted with unprecedented increases in medical cost trends that we were ultimately unable to fully offset, resulting in final financial results reflect strong core performance:performance below our expectations.

2023 Business and Financial Performance Results

 

  

We reportedReported diluted earnings per common share (EPS) of $22.67$20.00 on a Generally Accepted Accounting Principles (GAAP) basis and Adjusted EPS of $20.64;$26.09. *

 

We returned approximately $354 million to our stockholders in the form of dividends, representing an increase of $31 million over fiscal year 2020;

Over 97% of our Medicare Advantage members in 2021 were in a plan with a 4-Star rating or higher for 2022 and we’ve increased the number of contracts that received a 5-Star rating from 1 contract in 2021 to 4 contracts in 2022 - the most in our history;

We grew our Individual Medicare Advantage membership by 446,400 members, or 11.3%, in 2021, from 3,962,700 members as of December 31, 2020, to 4,409,100 members as of December 31, 2021, with enrollment in our dual eligible special needs plans (D-SNP) growing by more than 40% in 2021, and enrollment in our Humana Honor plan designed for Veterans, that is also available to all Medicare eligibles, growing by 80% in 2021;

We accelerated the growth of our senior-focused, value-based primary care organization, the largest in the nation, ending 2021 with more than 200 centers serving approximately 350,000 patients across 24 markets in 9 states;

We saw continued growth in our pharmacy business, with our Pharmacy Benefit Manager (PBM), the fourth largest in the country, processing 515 million 30-day equivalent scripts in 2021, an 8 percent increase year over year; and

We became the largest home health and hospice organization in the nation through the completion of our acquisition of Kindred at Home, and made substantial progress towards our goal of scaling and maturing a risk-bearing, value-based model that manages the provision of home health, durable medical equipment (DME) and home infusion services.

Returned approximately $2.0 billion to our stockholders in the form of dividends and stock repurchases.**

 

* 

Grew our individual Medicare Advantage membership by 843,300 members, representing 18.5% growth over fiscal year 2022. The Company continues to demonstrate individual MA membership growth above the industry average, with a three-year compound annual growth rate of 11%.

Remained the industry-leader in Star Ratings among our publicly traded peers for the sixth consecutive year, with 94% of our Medicare Advantage members enrolled in 4-star and above contracts,*** 61% of members in 4.5 and 5-star contracts, and four of our contracts receiving a 5-star rating.

Stockholder Dividends

3-Year EPS Comparison

LOGOLOGO

The footnotes below are referenced throughout this proxy statement.

*

Please refer to section entitled “Organization & Compensation Committee Report” inAnnex III to this proxy statement for a reconciliation of non-GAAP to GAAP financial measures. We encourage each stockholder to read theour full financial analysisstatements for year the ended December 31, 20212023 contained in our Annual Report on Form 10-K, filed with the SEC on February 17, 2022. 15, 2024.

**

Stock repurchases includes $73 million in connection with employee stock plans.

***

Membership totals in MA plans with 4+ Star Rating reflect membership as of October 2023 when Star Ratings were released by the Centers for Medicare & Medicaid Services (CMS).

 

8

Humana  |  2022 Proxy Statement  Company Overview


Corporate Governance

LOGO

Care for the whole person – emotionally, physically, and spiritually, building inspired communities where health and well-being prosper.

Humana is committed to having sound corporate governance principles and operates within a comprehensive plan of governance for the purpose of defining responsibilities, setting high standards of professional and personal conduct, and ensuring compliance with such responsibilities and standards. Sound corporate governance is essential to running our business effectively and to maintaining our reputation of integrity in the marketplace. At the heart of these efforts lie our Company Values, the guiding forces behind all our actions — Inspire Health, Cultivate Uniqueness, Rethink Routine, Pioneer Simplicity, and Thrive Together. In addition, our Board of Directors has adopted Corporate Governance Guidelines, which we refer to as the Guidelines, intended to comply with the requirements of Section 303A.09 of the NYSE Listed Company Manual. The Guidelines may be viewed on our website at www.humana.com. From the www.humana.com website, click on “Investor Relations,” then click on “Corporate Governance” subcategory and then click on the link entitled “Corporate Governance Guidelines.”

Role of the Board and Board Leadership

Role of the Board

The business of the Company is managed under the direction of the Board, whose members are elected annually by the Company’s stockholders. The basic responsibility of the Board is to lead the Company by exercising its business judgment to act in what each director reasonably believes to be in the best interests of Humana and its stockholders, while engaging in active and independent oversight of the management of the Company’s business affairs and assets. In order to fulfill its responsibilities to the Company’s stockholders, the Board, both directly and through its committees, regularly engages with management to both evaluate the Company’s current operations and encourage the innovations and strategic imperatives that will drive our success in the future. The Board monitors management performance through reviews of the most critical issues facing the Company, including approval of the Company’s strategy and mission, execution of the Company’s financial and operational goals, oversight of risk management, succession planning, and determination of executive compensation. The Board plans for the future by ensuring management focuses on innovation in our strategy to meet the speed of change in our industry and monitoring the Company’s human capital management functions, working closely with the management team to ensure the Company has the correct levels of talent in place – within each business segment – for continued success in present and future states of the Company.

Board Oversight of Risk

While management is responsible for designing and implementing the Company’s risk management process, controls and oversight, the Board, both as a whole and through its committees, has overall responsibility for oversight of the Company’s risk management. The full Board regularly reviews risks that may be material to the Company, including those detailed in the Audit Committee’s reports and as disclosed in the Company’s quarterly and annual reports filed with the SEC. While the Board has established committees designated for various oversight functions, it is common practice for committees to collaborate on overlapping issues.

LOGO

Appreciate individual uniqueness, creating an environment where everyone can fully be themselves, reflecting all of us and the communities we serve.

LOGO

Work and learn together, transforming the norm to strengthen operational excellence and outcomes.

LOGO

Take personal accountability, working together to create simple, personalized, quality experiences.

LOGO

Collaborate openly, building positive relationships to achieve strong, sustainable results for us and the people we serve.

Corporate GovernanceOverview  2022 2024 Proxy Statement | Humana

 

     93


BOARD OF DIRECTORS

Oversees Management of Major Risks

Regulatory & Public Policy

Financial

Succession Planning

Strategic

Reputation

Cyber Security Investment Objectives

Audit

Committee

Organization & Compensation Committee

Nominating,

Governance & Sustainability Committee

Technology

Committee

Investment

Committee

 Financial Statement integrity and reporting

 Legal, regulatory and compliance

 Internal controls

 Cyber security risk oversight

 Executive compensation policies and practices

 Non-executive compensation policies and practices

 Succession planning

 Human Capital Management

 Governance structure and processes

 Legal and policy matters

 Stockholder concerns

 Board refreshment

 Environmental, Social and related-Governance (ESG) oversight

 Information security, technology and privacy & data protection

 Company IT strategy and consumer facing technology

 Investment objectives and policies

 Investment results and performance evaluation

Management

Business units identify and manage business risks; Central functions design risk framework (setting boundaries and monitoring risk appetite); and Internal Audit provides independent assurance on design and effectiveness of internal controls and governance processes.

The goal of these processes is to achieve serious and thoughtful board-level attention to the Company’s risk management process and system, the nature of the material risks faced by the Company, and the adequacy of the Company’s risk management process and system designed to respond to and mitigate these risks.

Board Leadership

Leadership of the Board is essential to facilitate the Board acting effectively as a working group to the benefit of the Company and its performance. As Chairman of the Board and our lead independent director, Mr. Kurt J. Hilzinger assumes key duties to ensure effectiveness and collaboration in all aspects of the Board’s role.

Duties of Our Chairman

LOGO    Serves as Chair of regular sessions of the Board and manages the overall Board process.

LOGO    Leads the Board in anticipating and responding to crises.

LOGO    Oversees and monitors Board engagement, participation and continued education to ensure our directors are in-tune with issues of our dynamic industry and the evolving landscape.

LOGO    Supports the Nominating, Governance & Sustainability Committee with director on-boarding and orientation programs.

LOGO    Models culture, philosophy, inclusivity and values expected of all directors.

LOGO    Conducts individual meetings with other directors, including the CEO, and management team to encourage open communication, collaboration and differences in perspective.

LOGO    Evaluates overall Board effectiveness, with emphasis on identifying areas of enhancement, development and/or furtherance and communicating these observances to the Board for discussion.

LOGO    Represents the Board on occasions where it is important for the Board to respond on matters independently from the Company’s management team.

LOGO    Provides guidance and direction to the CEO and management team.

LOGO    Engages with stockholders, through verbal or written communications, and presides over the Company’s Annual Meeting of Stockholders. Also recommends to the Board an agenda to be followed at the Annual Meeting.

LOGO    Works with the Organization & Compensation Committee to develop the process for CEO compensation evaluations.

10

Humana  |  2022 Proxy Statement  Corporate Governance


The Board believes the advisability of having separate or combined chairman and chief executive officer positions is dependent upon the strengths of the individual or individuals that hold these positions and the most effective means of leveraging these strengths, in light of the challenges and circumstances facing the Company, which may change over time. At this time, given the composition of the Company’s Board, the effective interaction between Mr. Hilzinger, as Chairman, and Mr. Broussard, as Chief Executive Officer, Mr. Hilzinger’s status as an independent director and previous service as our Lead Director, and the current challenges faced by the Company, the Board believes that separating the chief executive officer and board chairman positions provides the Company with the right foundation to pursue the Company’s strategic and operational objectives, while maintaining effective independent oversight and objective evaluation of the performance of the Company.

Board Engagement and Undertakings

The Board holds itself to a high standard of engagement, with a hands-on approach that leads to critical insights regarding our customers, operations and business and enhances their level of governance and oversight. An essential component to the Board’s engagement is communicating with the Company’s internal and external stakeholders. To accomplish this, meetings of the Board may be held in key Company markets where, together with management, the Board will personally meet with associates, customers, providers and other stakeholders to gain direct feedback into the Company’s operations, experiences and overall effectiveness. Despite continued COVID-19 restrictions and the Company’s workforce having remained primarily work-from-home, the Board maintained its commitment to engagement and continued to meet with stakeholders virtually, by videoconference and teleconference.

Certain other engagement practices of our Board are described below.

Follows an annual topical calendar used to balance strategic, operational, compliance, and cultural matters, among others, and receives detailed reports on those topics, in addition to ad hoc subjects, throughout the year.

Utilizes clear and proactive Board meeting agendas to achieve high productivity at each meeting.

Holds executive sessions during every meeting, with the CEO present and then with only the independent directors. Relevant feedback is then reported to the CEO and the management team, creating a feedback loop from the Board to the management team.

Maintains regular communication with the CEO and management team, apart from formal Board meetings, to ensure consistent and continuous progress toward established goals.

Employs Board technology tools to review Board materials and to remain informed of ongoing Company endeavors, to efficiently communicate with the management team and to take formal action when necessary.

Performs in-depth organizational structure reviews, through the Organization & Compensation Committee, of line and functional teams within the Company to assess leadership bench strength, culture, succession planning, diversity and related matters, and engages regularly with rising leaders within the Company. In addition, the Organization & Compensation Committee regularly reviews associate engagement scores, which maintained momentum during 2021, with 89% of our associates saying that Humana is committed to their health and well-being.

Receives continued education from external consultants on a wide range of industry topics to keep them apprised of the latest trends and anticipated future trajectories. In addition to our director’s individual pursuits, Board education opportunities during 2021, included, (i) a formal education session with external consultants; (ii) guest speaker attendance during select meetings; and (iii) routine briefings on regulatory developments.

2021 Notable Board Actions

  Appointed 2 new directors to the Board

  Elected 2 new executive officers in connection with management succession planning

  Oversaw enhanced ESG disclosures, as well as, the Company’s transition to an integrated ESG reporting framework – Humana’s Impact Report

  Approved strategic acquisitions of One Homecare Solutions and the remaining interests in Kindred at Home

2021 Board and Committee      Meetings     

34    

Videoconference / Teleconference      Meetings     

5    

In-person Meetings     

1    

Annual Stockholder Meeting (Virtual)     

2021 Director Attendance Average     

97% 

(Based on aggregated Board and Committee meeting attendance; includes all directors having served during 2021.)

Corporate Governance  2022 Proxy Statement  |  Humana

11


Human Capital Management

Our associates are essential to our Company’s success in delivering on our core strategy, creating positive healthcare experiences and providing human care for our members. We are committed to recruiting, developing, and retaining strong, diverse teams, activelypromoting a culture of inclusion and diversity to foster a workplace where all associates feel they can be authentic and bring their whole selves to work every day – cultivating uniqueness and thriving together.

These efforts are overseen by our Board of Directors – which has designated to our Organization & Compensation Committee the responsibility for Board-level oversight of the Company’s human capital management and inclusion and diversity policies and practices – and implemented under the direction of our Chief Administrative Officer. As of December 31, 2021, we had approximately 95,500 associates and approximately 1,400 additional medical professionals working under management agreements primarily between us and affiliated physician-owned associations.

Our Culture and Approach to Work

We believe that our members’ experience is linked to our associates’ experience—engaged, productive associates are the key to building a healthy company, a caring environment where our associates go above and beyond for our members, driving innovation, and offering fulfilling experiences that incentivizes them to stay with us over the long-term. We provide opportunities for our associates to add to their personal well-being experiences that go beyond health to enhance their individual need for purpose, belonging and security.

Each year, we measure our success and opportunities to advance through our annual, third-party administered Associate Experience Survey – results of the 2021 survey showed that 91% of associates are highly engaged, which is world-class level. We provide the survey results to our entire associate population and encourage leaders to use the information to create open, honest action plans with their teams to build upon and further deepen our collective engagement.

7.3 Years

Average Associate Tenure

84%

Of associates have a strong sense that they belong at Humana

Listening to the voice of our associates reinforces our Value of Rethink Routine. We send pulse surveys to associates throughout the year to get feedback on how we’re doing, allowing us to assess our approach to work and take action when needed. We believe this helps to strengthen our culture and support associate engagement. It was through this process that WorkLife Reimagined was formed – our latest work style model that’s focused on flexibility and collaboration. We’ve learned that there isn’t just one way to operate or one way work gets done. That’s why WorkLife Reimagined includes work styles that benefit everyone and will continue to guide and shape our culture. As our associates transition to their new work style we’re equipping them with the tools they need to be successful – whether working at home, the office, in the field or a hybrid style – they’ll stay connected no matter where they sit.

Strong Company culture starts with leadership at the top. Our CEO inspires Company culture by sending a weekly Company-wide email where he engages with associates on a variety of topics including business matters, current events, health and well-being, family and personal interests. A survey link is included within these communications encouraging associates to speak up and share their own experiences directly with our CEO.

Inclusion and Diversity

Celebrating diverse backgrounds and creating an environment of inclusion is at the heart of Humana. We take intentional steps to nurture a culture where all employees, no matter who they are, feel like they can be their best selves and do their best work. Only then can we make the best decisions for our customers to ensure that they all have a fair and just opportunity to be as healthy as possible.

Our associates’ vast experiences and perceptions—their unique characteristics, backgrounds and beliefs—drive the groundbreaking, strategic thinking that gives our Company its competitive edge in a diverse marketplace. Our approach fosters innovative thinking and creativity, expands insights and generates better business outcomes.

We are committed to having balanced diversity at all levels of the Company and have developed a pathway for top, diverse talent within our recruiting initiatives. To achieve our recruiting and hiring goals we proudly partner with local and national advocacy groups, including the CEO Action for Diversity and Inclusion, the Catalyst CEO Champions for Change, and the OneTen Coalition, to provide information about open roles, assistance with resume preparation and application submission, and to design and execute other talent acquisition and development initiatives. We’re proud to be recognized as a Military Friendly employer. Under our Veterans Hiring Initiative we partner with dozens of organizations for veteran recruitment, including the Wounded Warrior Project, United States Army Reserve, and Paralyzed Veterans of America, and have hired thousands of veterans and military spouses. We have also designed and implemented programs that enhance our hiring initiatives aimed toward women in technology, retiree/mature worker populations, and closing the hiring gap of persons with disabilities versus those without disabilities.

We’ve also incorporated balanced interview panels into our interview process, through which we strategically engage a broad spectrum of interviewers that bring greater diversity and perspective. This proven best practice strengthens the candidate experience and hiring of diverse talent, ensuring we get the right talent for any given role, and minimizes the potential for personal blind spots when evaluating candidates. Balanced interview panels enhance the experience of interviewees and demonstrate our Values in action.

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October 2021

Joined the Historically Black Colleges and Universities (HBCU) Partnership
Challenge

A bi-partisan effort to promote greater engagement and support between private companies and HBCUs.

November 2021

Signed the Disability:IN CEO Pledge

A global organization with the world’s most comprehensive disability inclusion benchmarking, serving as a resource to corporations desiring to drive disability inclusion and equality in business.

Ranked # 1

Network Resource Groups (NRG)

Our NRGs were recognized by DiversityInc in its 2021 Top Companies for Employee Resource Groups.

We’re committed to building balanced diversity at all levels of the Company through a focused effort on supporting a pathway for top, diverse talent, strengthening current collaborations and forging new partnerships. Achievement in this area requires a mindset of shared accountability and commitment to enterprise outcomes. In 2020, Humana leaders aligned to high-level goals – hiring and promotion of diverse talent, retention of diverse senior leadership (VP and above), inclusion, mentoring and leaders participating in conscious inclusion training – with shared accountability focused on driving inclusion and diversity throughout the enterprise. We’ve employed a metrics-driven approach to address areas of improvement quickly and goal achievement is linked to executive compensation (refer to section entitled “Compensation Discussion & Analysis – Associate Incentive Plan” within this proxy statement for more information on executive compensation). Since introducing these shared accountability measures, we’ve seen year-over-year (YOY) improvements among our female associates and associates of color. Our workforce representation is tracked through self-disclosure by our associates, and are committed to transparent disclosure of our demographic data. The charts below represent our workforce demographics as of December 31, 2021.

Associate Demographics

LOGO

Pay and Benefits Philosophy, Compensation and Financial Security

We believe all of our associates have the right to receive a fair living wage and we are committed to maintaining a pay and benefits philosophy that is market-based and recognizes an associate’s contributions so that we can attract and retain an engaged, talented team. Our Company’s pay and benefits structure is designed to motivate and reward our associates - at all levels of the organization - for their skill development, demonstration of our Values and performance. While our programs vary by location, employee type and business, they generally include:

90%

Of associates would recommend Humana as a great place to work

LOGOLOGOLOGO

  Competitive Base Pay

  Associate Incentive Plan (Annual Bonus)

  Supplemental Pay (Including Overtime)

  Recognition Pay and Service Awards

  401(k) Retirement Savings Plan with Company Match Program

  Life Insurance

  Short- and Long-Term Disability Insurance

  Medical, Dental and Vision Benefits

  Supplemental Health Benefits

  Long-Term Care Insurance

  Go365® Wellness and Rewards Program

  Health Plan Incentives

  On-site Health and Fitness Centers

  On-site Health Screenings and Vaccinations

  Paid Time Off, Paid Holidays, Paid Volunteer Time Off and Jury Duty Pay

  Paid Parental Leave Program (6 Weeks)

  Paid Caregiver Time Off Program (2 Weeks)

  Employee Assistance Program

  Associate Discount Programs and Services

  Helping Hands Program

  Transit Services

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Talent Development and Growth Opportunities

We champion the individual goals and development of our associates, and provide a number of programs to ensure that our associates have the resources and support they need to deliver on their passion. The Humana Learning Center gives our associates the opportunity to earn professional certifications through continued education programs and to participate in instructor-led and online courses designed to strengthen soft and hard-skills and enhance leadership development. Our Career Cultivation team sponsors workshops and events to promote associate accountability within their personal and professional growth as part of overall career development. In 2021, our associates averaged approximately 35 learning and development hours per active associate.

Our associates are also encouraged to participate in mentoring programs with people of various backgrounds and cultures. We view mentoring as an essential development tool for sharing skills and knowledge so we can all succeed. Our commitment to mentoring feeds the successful future of our Company. In 2021, our associates participated in more than 2,700 mentoring circles, underscoring the Company’s focus on creating a culture of mentoring and inclusion. We also utilize development programs to enhance talent within our business segments through targeted internal initiatives, where we aim to upskill and reskill existing associates for opportunities in new career pathways.

84%

Of associates believe Humana provides them with opportunity for growth and development.

216,843 Hours

Volunteer hours tracked by 16,400 of our
associates in 2021

$1.2 Million

Total associate matching gift dollars made by The Humana Foundation in 2021

A Workplace With Purpose

Having a purpose and a connection to a community improves well-being. That’s why we strive to make it easy for our associates to give back, either as individuals or a team, to causes that ignite their passion and sense of purpose. Volunteerism is a tangible way to impact the health and well-being of the communities we serve and enrich our workplace.

We’ve created programs and practices to make volunteering easier and more vibrant for associates.

Our full-time associates annually receive eight hours of paid Volunteer Time Off (VTO)

We help associates discover and track volunteer opportunities through our Humana Together volunteer portal

We integrate volunteerism in our leadership development and team-building

We offer a matching charitable gift program through The Humana Foundation

We feature associates sharing their volunteerism stories on our Intranet to inspire others

We offer our associates paid time off to get vaccinated, including boosters, for COVID-19, helping to reduce barriers associates may have in taking time away from work to get vaccinated and supporting healthy communities

Board Oversight of Environmental, Social and Governance Matters

The Nominating, Governance & Sustainability Committee has responsibility for Board-level oversight of the Company’s ESG strategy, practices and reporting. The Nominating, Governance & Sustainability Committee receives formal ESG reports from management at least twice annually regarding the Company’s ESG initiatives, metrics and progress on established goals, as well as, ad hoc ESG communications as necessary. In addition, we have an internal ESG Steering Committee, overseen by our Chief Administrative Officer and Chief Legal Officer, to guide the integration of our ESG efforts with our long-term business strategy. This ESG governance structure complements the long-standing responsibility of our Board and each of our Board committees in overseeing various aspects of the Company’s ESG-related risks and practices, as illustrated below:

BOARDOF DIRECTORS

Nominating, Governance & Sustainability Committee

Audit

Committee

Organization &   Compensation CommitteeTechnology
Committee

Investment

Committee

  Risk Management

  Cyber Security

 ��

  Human Capital Management

  Inclusion & Diversity Practices

  Company Compensation Plans & Policies

  Privacy & Data Protection

  Information Security

  Investment Portfolio

  Investment Guidelines

Chief Administrative Officer and Chief Legal Officer

(In collaboration with members of the executive management team)

ESG Steering Committee

OversightManagementImplementation

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Strategic Focus on ESG

We realize that the future of our business is linked with the well-being of our associates, members and patients, the communities we serve, the healthcare system, and the environment. It’s with our stakeholders in mind that we’ve established five key pillars of our ESG program that align to our strategic business goals, supporting our commitments to sustainable business and improving health outcomes. These pillars – Access to Healthcare; Data Privacy & Protection; Environmental Impact; Product Quality & Safety; and Talent & Diversity – are the driving force behind our impact platform and will guide our ESG program.

We’ve developed quantitative and/or qualitative metrics within each pillar to track, monitor, measure and report our performance. Transparent disclosures are a top priority, as such, we’ve mapped our ESG disclosures to frameworks established by the Sustainability Accounting Standards Board (SASB) Managed Care Standard, the Task Force on Climate-Related Financial Disclosures (TCFD), and the Global Reporting Initiative (GRI). We also support the United Nations Sustainable Development Goals, aligning our efforts to three goals where our Company can most contribute: Goal 3 – Good Health and Well-being; Goal 8 – Decent Work and Economic Growth; Goal 12 – Responsible Consumption and Production.

Our Impact Platform

We’ve set our intentions to have a positive well-being impact among all of our stakeholder groups and have developed a platform where we believe we can make the most difference. Our impact platform sets the direction for how we will advance health equity, address needs in our communities and drive sustainable change with shared value. The pillars may connect to one or more categories within the impact platform, reinforcing the interconnectedness of our holistic approach to ESG. We’ve highlighted below key elements of our ESG program along with some of our notable pillar metrics.

LOGO     LOGO     LOGO     LOGO         

For each person, we make it easier for people to achieve their best health.

For each community, we work to advance population health.

For our business and the collective healthcare system, we help build more equitable and sustainable practices.

For the environment, we invest in the health and sustainability of the environments around us.

We are all on a unique journey to our own best health, so through empathy and a personalized approach, we not only address medical needs, but meet people where they are by helping our customers, employees – everyone – address human needs, too.Where people live, work and play is inextricable from their health outcomes, so we’re passionate about taking on the social determinants of health that impact their communities on a local level.The future of health depends on the health of the collective system, so alongside our partners, we’re striving to create a more equitable health ecosystem that incorporates sustainable business practices, to better serve all of us, and the next generation.The health of individuals is deeply tied to the health of their environments, so we do our part to invest in, protect and care for the places and planet all people depend on.

For Each Person

Our members achieving their best health is at the top of our mind. We know that health is not linear. Every member is unique as are the communities we serve. That’s why we’re continuously working to ensure that our health plan products and services are as affordable as possible, as well as, addressing access to healthcare barriers so that all of our members can receive the care they need. As we cultivate our philosophy of whole-person health care, we’re addressing the most crucial needs of our members, which means truly caring about them, understanding what is important to them and finding ways to make it easy for them to live their best life. Thanks to processes such as integrated care delivery and using health screenings that consider social determinants of health, we have a clearer view of each member’s very personal barriers to their best health. Through our integrated approach, we are building the tools to address the physical, behavioral and social factors that all play such a critical role in promoting improved health outcomes. Please refer to our Value-Based Care Report for more information on these efforts.

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15


Our associates are the driving force behind our Company’s well-being initiatives. We believe that when we invest in our associates they pay it forward by investing in others. In this effort we actively live out our Values, cultivating uniqueness and thriving together.

29%

Associate participation in at least
1 of our 10 associate-led NRGs
during 2021 –

With over 8,574 members, the Women’s NRG is the largest.

The Company’s Office of Inclusion & Diversity (our “I&D Office”) efforts are led by our Chief Inclusion and Diversity Officer, who reports directly to the Chief Administrative Officer. The I&D Office works with key partners like the Chief Health Equity Officer, our new Director of Diverse Talent Strategy, our Executive Inclusion & Diversity Council (the “Council”), our Network Resource Groups (“NRGs”), local Inclusion and Diversity Councils, and Culture & Engagement professionals across the enterprise, to maximize our vibrant diversity and inclusive culture to empower our business strategy to help the communities we serve achieve their best health.

To help integrate inclusion and diversity into the fabric of the organization from the top down, the Council is led by our President and CEO, with top priorities consisting of (i) leading and informing the strategy to drive the hiring, developing, promotion and retaining of our full diverse workforce; (ii) creating and maintaining an inclusive culture; (iii) reviewing our supply base and spend for diversification opportunities; and (iv) improving transparency and accountability to sustain outcomes. The Council sets company-wide inclusion and diversity goals and objectives that complement our Talent & Diversity pillar.

Our inclusion and diversity objectives also aim to build an awareness of biases and beliefs, identify differences and similarities of our multi-generational workforce and enable associates to leverage differences to drive innovation and create value. We are committed to growing our associates’ inclusion skills and diversity knowledge and provide a variety of associate training programs and workshop opportunities in areas of unconscious bias, disability awareness, cultural competency, racial equity, and social justice, among others.

Our fundamental belief that every person has the right to a safe workplace includes having freedom of gender identity and expression, which we have included within our non-discrimination and anti-harassment policies. Additionally, our Company adopted guidance to support associates who are transgender and/or identify as non-binary. Our Workplace Gender Transition Guidelines, available to all associates, outlines a collaborative process to help guide transitioning associates, their coworkers and leaders by addressing the needs and issues that may arise in the workplace, and includes alignment of workplace resources, education and coaching.

91%

Of associates believe top leaders of their organization would not tolerate workplace behavior that is discriminatory or retaliatory.

KEY PILLAR METRICS

Talent & Diversity

Voluntary Turnover Rate (VTR) Goal

Reduce Director Level+ VTR

We’re working to retain representation among women and people of color in leadership levels of director and above, and have set VTR goals, excluding voluntary retirement, of 4% in each demographic.

2021 Women VTR: 5%         2021 POC VTR: 9%

Talent & Diversity

Hiring and Promotion Goal

Increase in Director Level+ Representation

We’re working to increase representation among women and people of color in leadership levels of director and above, and have set targets of 50% for women and 30% for POC.

2021 Women: 47%         2021 POC: 29%

For Each Community

We recognize that we are part of a bigger community – one that is connected to our members, patients, employees and neighbors. We are dedicated to the holistic health of all people, and that is why we invest in communities across the country to advance health equity. Health equity is about making sure we all have a fair and just opportunity to be as healthy as possible. Helping communities and the people in them grow stronger benefits all of us, because where people live, work and play is inextricable from their health outcomes. We’re partnering with communities to advance health equity on a local level and take on the social determinants of health that impact all of us.

As our Company shifts from an insurance company with elements of health to a health company with elements of insurance, we are focused on five areas of influence to help improve health and aging: primary care, home health, pharmacy, behavioral health and social determinants of health. Championing this effort is our Bold Goal – a population health strategy launched in 2015 to improve the health of the people and communities we serve by creating solutions to address unmet social needs and making it easier to achieve their best health.

Since 2015 we’ve continued to adapt as we learned more about our communities and our members. We discovered how important it is to develop personalized solutions, determining how best to meet the needs of our members while striving to (i) help Humana and its partners understand social determinants of health and their prevalence in our communities; (ii) convey how such determinants actualize into social needs that limit or prevent health care; and (ii) create impactful care solutions that account for our members specific health-related social needs. That has meant getting to know our members better and the daily health-related challenges they’re facing in order to connect them to people and organizations who can support them – not only in their clinical needs, but also in their individual health-related social needs,

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such as getting access to healthy food, helping to connect them socially and addressing their housing needs. With community-based organizations and healthcare practices, we are creating evidence-based, scalable and financially-sustainable solutions to improve population health at a local level. We’ve scaled social determinants of health screenings across our business, which has impacted millions – connecting those in need to community resources and support.

Because we know social determinants of health play a significant role in addressing health needs, we have developed a variety of programs, services, benefits and resources for members and the public. Our Far From Alone campaign, with many partners, strives to improve the mental health and wellness of others by increasing social connectedness and reducing feelings of loneliness. The campaign drives awareness, action, and advocacy in support of addressing this important social determinant of health. Learn more about our Far From Alone campaign, and how you can get involved, at its website https://farfromalone.com.

$3.6 Million

Invested by The Humana Foundation
supporting 30 community-based projects
aimed to address social determinants of
health in our hometown Louisville, KY in 2021.

Over 1.6 Million Meals

Provided through our Basic Needs
Program, making a direct impact on
food insecurity to more than 94,000 at-risk
members in 2021.

KEY PILLAR METRICS

Access to Healthcare

Value-Based Primary Care Goal

Expand Geographic Presence

We’re working to grow and expand our geographic presence in value-based primary care to provide more access and high-quality care to patients, including those in underserved areas. We ended 2021 with 206 primary care centers, representing a 32% increase over the prior year.

Access to Healthcare

State Medicaid Goal

Increase Medicaid Footprint

We’re working to expand the number of our state-based Medicaid contracts to deliver care to more individuals of this vulnerable population. As of December 31, 2021 we had Medicaid contracts in six states: FL, IL, KY, OH, SC, and WI.

For Our Business and the Collective Healthcare System

Throughout our operations, we are dedicated to ensuring that every business decision we make reflects our commitment to improving the health and well-being of our members and patients, our associates, the communities we serve, and our environment. Our holistic, integrated approach to care and longstanding commitment to caring for vulnerable populations also afford us a unique opportunity to promote health equity and address the effects of health disparities in the U.S. healthcare system. We have established policies and programs that illustrate our commitment to responsible business practices that lead to a more efficient, equitable and sustainable healthcare system.

Our suppliers are essential to delivering services within our business, which is why we incorporate ESG principles into our procurement strategy - ensuring a fair and equitable approach to procurement. We understand that partnering with diverse suppliers and small businesses, and engaging with them to support common ESG goals, can lead to future sustainability and a reduction in environmental costs. We also understand that inclusive procurement practices deliver broad societal benefits by creating economic opportunities for traditionally underserved or underrepresented groups. That’s why we’ve made it a priority and strive to attract qualified, certified suppliers who reflect our customers, associates and communities we serve. Leveraging these suppliers now and in the future is a win-win for everyone.

Our Supplier Diversity Program promotes an inclusive approach to procurement that ensures we invest our dollars with a balance of partnerships with historically underutilized businesses. We also support the growth of small and diverse-owned businesses by being a resource partner for them, and during 2021 we launched a Supplier Diversity Mentor-Protégé program. The program is a 12-month pilot with half-day, onsite seminars featuring leadership from across our organization exploring topics impacting business growth and operations of small and diverse businesses. The program is designed to identify and overcome barriers that typically inhibit or restrict the success of small and diverse businesses and better position them for growth, sustainability and inclusion.

We also survey suppliers annually through a sustainability scorecard that addresses sustainability, diversity practices and supplier performance. The scorecard is distributed at year-end to our top 50 Prime Suppliers (top spend suppliers) and we typically receive a 25-30% overall spend response rate. We also hold our suppliers accountable for complying with our Company’s Standard of Excellence and Ethics Every Day policy – to the same degree as our associates.

Our governance practices and policies reflect strong controls that provide a solid foundation for our continued success. We are committed to supporting the delivery of consistent high-quality care, promoting efficient outcomes in the healthcare system and ensuring that healthcare remains affordable for all members and patients. Further, in a healthcare industry increasingly driven by quality, we have a corporate Quality Improvement (QI) program – with practicing network physicians as members of various quality subcommittees – to monitor, evaluate and facilitate improvement in the quality of health care services provided to our members. The QI program is overseen by our Corporate Quality Improvement Committee (CQIC), which among other things, promotes alignment to the third dimension of

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17


quality (experience and outcomes) through collaboration with stakeholders, personal accountability and speaking up when quality does not meet our standards.

Our associates are integral to running our Company responsibly and key to our ethics and compliance practices. That’s why all Humana associates and contractors are required to complete an annual ethics and compliance training, and why our Enterprise Compliance team places an emphasis on communicating about ethics, compliance and risk in an intentional way, throughout the year. Our Company is also committed to building digital care delivery operations and leveraging key insights from enterprise analytics. Integrating these critical capabilities across the organization will further accelerate our Company’s move toward differentiated experiences for our customers at the intersection of healthcare and lifestyle, tailored especially to the needs of seniors. We recognize that our emphasis on technology comes with great responsibility as our customers trust us with keeping their information safe. To that end, we are proud to be an industry leader in the adoption of principles and governance to guide our implementation of emerging technologies.

KEY PILLAR METRICS

Talent & Diversity

Diverse Supplier Spend Goal

Increase Supplier Diversity

We’re working to increase our diverse supplier base through an inclusive and equitable approach to procurement, and set yearly goals to increase total diverse supplier spend among our Prime Suppliers. Our 2021 target increase was 9%.

2021 Total Diverse Spend: $345 Million, an 8.99% increase over 2020

Product Quality & Safety

Star Ratings Goal

Continue Leadership of Members in Plans with 4+ Star Rating

Our commitment to quality of care, patient-centered clinical outcomes and customer service is reflected in the consistent strength of our plan’s Star Ratings.

Membership in plans with 4+ Star Rating1: 4.8 million members (2022); 4.1 million members (2021); 3.7 million members (2020)

For the Environment

We know that a strategic focus on environmental sustainability is critical to fulfilling our mission of helping people achieve lifelong well- being. The better we do at protecting the health of our environments, including our operations, supply chain, and communities around us, the better we can do at positively supporting people on their health journeys. We believe that our demonstrated commitment to environmental sustainability not only positions us to offer reliable and cost-effective service to our customers, but also embodies the principle of an intrinsic link between the health of our planet, our business, and the services we provide.

As a services company, our direct environmental impacts are concentrated within our internal operations. As such, our focus is on areas where we feel we can make the most impact: energy, emissions, and waste. We augment these initiatives with a broader effort to conserve other resources such as water, manage our real estate footprint, and collaborate with our stakeholders – namely our associates – to actively embrace sustainability. We understand that climate change impacts pose risks and opportunities for our business and seek to manage such impacts in several ways, including: continuous strengthening of our already robust business continuity program, investing in energy management and efficiency projects and applying financial incentives to support efforts toward reducing our environmental footprint. We also set challenging environmental targets, as shown below, that promote collaboration with vendors and associates to achieve them. These efforts mitigate risks and demonstrate our commitment by validating the intrinsic link between environment and well-being.

Our Workplace Experience team, overseen by our Chief Administrative Officer, is responsible for day-to-day planning, coordination and implementation of the Company’s operational environmental sustainability policies, including those around energy management and climate-change mitigation/ adaptation. The Workplace Experience team also leads initiatives toward achieving environmental targets in addition to tracking/reporting progress and assessing opportunity toward setting new climate-change mitigation/adaptation targets.

We are now working with a global leader in the digital transformation of energy management and automation, to create a more robust next generation goal that will align with the Science Based Targets initiative (SBTi) to address climate change. We understand that a path forward to net zero emissions is important to our collective future and we’re analyzing tactics, appropriate to our business, that allow us to contribute to net zero goals. We expect to publicly announce our new SBTi aligned environmental goal in late 2022. We encourage you to review our Environmental Sustainability Policy Statement and our 2021 CDP Report to learn more about our sustainability efforts and areas of concentration.

1

Membership totals in plans with 4+ Star Rating reflect membership as of the September date when the applicable Star Ratings were released.

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KEY PILLAR METRICS

Environmental Impact

Humana Pharmacy Goal

TRUE Certified Zero-Waste Site

Our West Chester, OH distribution center is working to achieve a 90% waste diversion rate (WDR) for its production materials by the end of 2022, becoming Humana’s first TRUE certified site.

2021 WDR: 89%         Target WDR: 90%

Environmental Impact

Paper Reduction Goal

Increase Adoption of Digital Materials

We’re working to increase the digital adoption rate (DAR) among our medical plan members, encouraging them to receive more of their information from us online instead of on paper, and we plan to announce our goal metrics in Spring 2022.

ENVIRONMENTAL SUSTAINABILITY INITIATIVES

Greenhouse Gas (GHG) Emissions ReductionLOGO     Energy ReductionLOGO     

  We achieved our goal to reduce greenhouse gas emissions by 2.1% year-over-year (from a 2017 baseline) by the end of 2022 and are now pushing to go beyond our baseline measure. In 2021, keeping in line with best practices around goal setting, we expanded our goal boundary to include all Humana owned1 and leased properties and recalculated our goal progression over the last five years. Our emissions goal results2 ending 2021 reached 16%.

We offer our associates new workstyle options and alternative transportation options, engage in partnerships and programs designed to reduce emissions.

We put our buildings into “hibernation” to conserve energy while our associates were working from home during the pandemic. We used this opportunity to expedite repairs and replace equipment and infrastructure.

We calculate GHG emissions in accordance with the methodologies outlined by the GHG Protocol.

We provide a full report of our yearly energy consumption and reduction efforts within the Global Reporting Initiative (GRI) Content Index. We report our GHG initiatives to CDP and utilize a third-party assurance contractor to provide limited assurance verification of our information. We also align our reporting to the framework established by the Task Force on Climate-Related Disclosures (TCFD).

  We assess and make investments in renewable energy sources when and where it makes sense, environmentally and financially.

We’ve installed solar panels on the rooftop of an owned facility.

Our fleet is greener because our mobile marketing offices – vans equipped with WiFi, cameras and more – have been fitted with solar panels to reduce energy and power to operate the vehicles.

  We incorporate standards from both the ENERGY STAR Program and the U.S. Green Building Council’s LEED standards (Leadership in Energy and Environmental Design) into the design of new construction projects.

We proudly have 31 ENERGY STAR certified facilities within our portfolio sites.

Our data centers now have new energy-efficient cooling units and smart flooring to distribute air more efficiently. Both data centers are ENERGY STAR certified.

We continue working toward 100% replacement of fluorescent lights with LED lights across our portfolio sites.

Waste ReductionLOGO     

Absolute Target: 60% waste diversion rate (WDR) of waste to landfills via reduction and recycling efforts at our portfolio sites where Humana and our vendors manage waste recycling services, by the end of 2022. We not only achieved our goal early – we exceeded it – at a WDR of 65%. In 2021, keeping in line with best practices around goal setting, we expanded our goal boundary to include certain acquisitions1 where we have direct payment and available frequency data.2

Humana Pharmacy, our mail-order pharmacy, engages in medical waste reduction efforts by donating unused prescription medication – which would otherwise be incinerated – to nonprofit organizations that provide free healthcare, dental care and prescription medication to individuals who are uninsured or underinsured.

We partner with Georgia Pacific to recycle and reuse our baled empty pill bottles, pill bottle caps, cardboard and shrink wrap.

We promote and track our reduction and recycling efforts and make it convenient for our associates to recycle in our facilities. We also report our waste reduction initiatives to CDP and utilize a third-party assurance contractor to provide limited assurance verification of our information.

1  Kindred at Home is excluded from the re-baselining of GHG emissions and waste diversion.

2  2021 results described herein have been estimated. The final data will be published on our website (www.Humana.com) when available, which is anticipated during the second quarter of 2022.

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19


ETHICAL SUSTAINABILITY INITIATIVESHelpful ESG Resources
Ethics & Compliance

LOGO


We invite you to review the additional materials below to learn more about our Company’s ESG related reports, programs, policies and initiatives.

Annual Reports

https://humana.gcs-web.com

Humana Impact Report(Available Spring 2022)

2021 CDP Report

2021 Bold Goal Progress Report

2021 Value-Based Care Report

Policy Statements

https://humana.gcs-web.com

Environmental Sustainability Policy and Standard

Supplier Diversity Statement

Statement of AI Principles

Ethics

https://humana.gcs-web.com/corporate-governance

Ethics Every Day

Anti-Corruption Statement

Supplier Diversity Program

https://www.humana.com/supplier-information/supplier-diversity.

Fraud, Waste and Abuse

https://www.humana.com/legal/fraud-waste-and-abuse

Ethics Every Day for Contracted Healthcare Providers
    & Third Parties

Compliance Policy for Contracted Healthcare Providers
    & Third Parties

Population Health

https://populationhealth.humana.com

Data Privacy and Cyber Security

https://www.humana.com/legal/privacy

Public Policy

https://www.humana.com/about/public-policy

Workplace Benefits

https://careers.humana.com/why-choose-humana

The Humana Foundation

https://www.humanafoundation.org

Humana Healthcare Research

https://research.humana.com

  Our associates are the key to ethics and compliance.

 We have an Enterprise Compliance team that regularly communicates and engages with associates on ethics and compliance topics throughout the year.

 We require all associates (including executive officers and independent directors) and contractors to complete an annual training course on ethics and compliance matters.

 We enforce Standards of Conduct and a Compliance Policy, which are specifically designed for our contracted healthcare providers and third parties in effort to deter fraud, waste and abuse.

  Humana is an industry leader in the adoption of principles and governance to guide its implementation of emerging technologies.

 We govern our use of Artificial and Augmented Intelligence according to industry-leading principles.

 We have interdisciplinary committees that establish governance over the deployment and quality of Artificial and Augmented Intelligence models.

 We have signed the EqualAI pledge committing to ensuring our Artificial and Augmented Intelligence tools do not incorporate unintentional bias, and require all of our Artificial or Augmented Intelligence models that inform decisions about individuals to be reviewed to detect inadvertent bias. We also ask our vendors who utilize Artificial and Augmented Intelligence tools to sign the EqualAI pledge or another similar pledge.

Data Privacy

LOGO


  We are committed to continuously enhancing and strengthening our technology infrastructure and security protocols.

 We employ best-practice precautions to safeguard information and protect our members’ data. We deploy defensive practices against the ever-evolving cyber threat landscape by measuring and maturing our cybersecurity capabilities and actively monitoring risks posed by threat actors.

 We have established formal data governance, which includes accountability, oversight, processes and controls to ensure our data usage transparency and non-repudiation.

 We refresh our data privacy and security policies at least annually.

 We provide Company-wide cyber security training to associates, led by our Enterprise Information Protection team, on how to avoid security vulnerabilities and equip them with the necessary tools to protect Company data and to reduce risk. We also test their knowledge through internal phishing campaigns – tracking and reporting aggregated outcomes to leadership.

 We report data breaches, as required by law, to the U.S. Department of Health and Human Services (HHS), Office for Civil Rights (OCR). Our reports are publicly available, free of charge, and can be obtained through the OCR Portal at:
https://ocrportal.hhs.gov/ocr/breach

 We engage an independent third party audit firm to perform an Annual Service Organizational Controls (SOC) 2 audit of enterprise claims platforms within the following Trust Services Criteria: availability, confidentiality and security.

Safety & Security

LOGO


  We integrate a culture of safety and security into all aspects of our business to provide our associates, contractors, members and visitors a safe and secure work environment – we are committed to protecting people and safeguarding key assets, properties and information. 94% of associates feel safe and protected from physical risks while working.

 We have an Enterprise Safety and Security Policy that applies to our associates, facilities (owned or leased), and anyone requesting facility admittance regardless of relationship.

 We maintain and utilize the following resources to manage/mitigate occupational health and safety: Environmental Health and Safety Manual, Incident Reporting System, Associate Safety Handbook and Associate Emergency Preparedness Training. 95% of associates trust Humana would take appropriate action if a physical safety or security concern/incident was reported.

 Our safety and security team periodically performs on-site compliance audits to ensure safety plans and practices are implemented, in addition to providing training tools and information.

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Corporate Responsibility Awards and Recognition

We are pleased to have received recognition for our 2021 corporate responsibility and ESG efforts and we appreciate the acknowledgement of our commitment to inspiring health and well-being. Highlighted below are just a few of our valued achievements, however a complete list of awards and recognition is available on our website at www.humana.com – from there click “Corporate Responsibility” and then click “See Our Awards.”

LOGO

Corporate Governance  2022 Proxy Statement  |  Humana

21


Board Evaluation Practices

LOGO

The Board is committed to a rigorous self-evaluation process. Through evaluation, directors annually review the performance of the Board and each committee, as well as their own individual contributions, including areas where the Board feels it functions effectively, and most importantly, areas where the Board can improve. The Nominating, Governance & Sustainability Committee, with participation from our Chairman and Chief Executive Officer, initiates the annual Board evaluation process. We believe that having a review process for each group helps to (i) ensure an adequate representation of requisite skills; (ii) encourage high levels of engagement from directors; and (iii) strengthen the overall effectiveness of our Board. Results of the evaluations are shared with the Chairman of the Board and the Chairman of the Nominating, Governance & Sustainability Committee and then later discussed with the entire Board in an aggregated manner, with agreed upon actions and improvements then implemented and monitored for effectiveness.

Board Evaluation

The Board evaluation typically consists of a written questionnaire containing qualitative scaled and open-ended questions related to the effectiveness of the Board during the prior year. The questionnaire hones in on specific areas of responsibility and critical attributes of the Board in order to solicit candid feedback from each director. The questionnaire also seeks practical input as to what the Board is doing well, areas in which the Board could improve and any undertakings that the Board should commence or terminate. Every third year, this written evaluation process is supplemented by oral interviews and an analysis of Board and committee effectiveness conducted by an independent consultant.

Director Self-Evaluation

The director self-evaluation requires each director to honestly reflect upon and carefully consider his or her performance based on key characteristics that are expected of all board members. The self-evaluation also allows directors to provide additional or updated information regarding their skills and qualifications which in turn helps the Nominating, Governance & Sustainability Committee make future assessments and determinations regarding Board composition. The Company encourages directors to participate in continuing education programs focused on the Company’s business and industry, their committee roles and responsibilities, as well as legal and ethical matters. Annually, the Board will meet for purpose of furthering their education through external guest speakers to gain insights into key issues facing the industry and the Company, to supplement management’s views and perspectives.

Committee Evaluation

Each of our Board committees engages in an annual performance evaluation and a general charter adequacy review. Each committee is responsible for determining the manner of evaluation and for carrying out the evaluation. Further, the Board evaluation questionnaire includes a section specifically concerning Board committee structure and the performance and effectiveness of each committee, which is an opportunity for board members to provide feedback on each committee, regardless of their individual committee membership.

Director Independence

The Guidelines contain standards to assist the Board in its determination of director independence. In addition, to qualify as independent under the Guidelines, the Board of Directors must affirmatively determine that a director has no material relationship with the Company, other than as a director.

Pursuant to the Guidelines, the Board undertakes an annual review of director independence. During this review, the Board considers transactions and relationships between each director or any member of his or her immediate family and the Company and its subsidiaries and affiliates, including transactions or relationships that are reported under “Certain Transactions with Management and Others” in this proxy statement. As provided in the Guidelines, the purpose of this review is to determine whether any such transactions or relationships are inconsistent with a determination that a director is independent.

In the course of this review for the current year, the Board specifically analyzed and discussed several matters:

(1)

a relationship between the Company and Fiserv Solutions, Inc., a subsidiary of Fiserv, Inc., or Fiserv, for which Frank. J. Bisignano, one of our former directors, serves as an executive officer and a director;

(2)

a relationship between the Company and Pfizer Inc., or Pfizer, for which Frank A. D’Amelio, one of our current directors, serves as an executive officer;

(3)

a relationship between the Company and Cerner Corporation, or Cerner, for which David T. Feinberg, M.D., one of our current directors, serves as a director and an executive officer.

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(4)

a relationship between the Company and Howard University and the Howard University Healthcare system, or Howard, for which Wayne A. I. Frederick, M.D., one of our current directors, serves as an executive officer;

(5)

a relationship between the Company and Chrysalis Ventures, LLC, or Chrysalis, for which David A. Jones, Jr., one of our current directors, serves as Chairman and Managing Partner and in which Mr. Jones, Jr. has a financial interest;

(6)

a relationship between the Company and Foundation Radiology Group PC, or Foundation Radiology, for which Mr. Jones, Jr., one of our current directors, served as a director during part of 2021, and of which Chrysalis Ventures, LLC has an investment interest; and

(7)

financing arrangements between the Company and companies that are affiliated with certain of our directors.

Fiserv. In 2021, we contracted for certain marketing and advertising services from Fiserv in connection with member communication materials for which we paid approximately $12.15 million, which is comparable to other non-affiliated vendors for the provision of similar services, is not material to the Company, and does not represent a direct or indirect material interest to Mr. Bisignano.

Pfizer. The relationship between the Company and Pfizer includes a negotiated rebate based on the volume of prescriptions of Pfizer drugs obtained by Humana members, which volume includes claims paid by Humana for our members and the co-payments paid by our members. Payments to Humana from Pfizer result from activity with many intermediaries over whom Humana exercises no control (i.e., the providers who prescribe these medications, the distributors who sell to the retailers, and the retailers from which our members get prescriptions). In 2021, the Pfizer rebates amounted to approximately $71.3 million, substantially all of which were passed through to our members in the form of lower premiums and/or higher benefits. Our subsidiary, Humana Healthcare Research, Inc. or HHR, has also contracted with Pfizer to complete various research studies at commercial rates and following our standard protocols; HHR received approximately $250,750 in fees from Pfizer for this service in 2021. The Company also received approximately $254,250 from Pfizer during 2021 related to hanger rental and other associated aircraft incidentals. The relationships described herein did not represent a direct or indirect material interest for Mr. D’Amelio.

Cerner. Cerner has a license subscription contract with our subsidiary, Humana Digital Health and Analytics Platform Services, Inc., or HDH&A. In 2021, Cerner paid HDH&A approximately $6.5 million in associated licensing, professional service and maintenance fees, which is comparable to other non-affiliated customers for the provision of similar services. Our subsidiary, Conviva Medical Center Management, LLC, has a database subscription contract with Cerner for which it paid Cerner approximately $7,000 in associated fees during 2021, which is comparable to other non-affiliated customers for the provision of similar services. The relationships described herein are not material to the Company and do not represent a direct or indirect material interest to Dr. Feinberg.

Howard. The relationship between the Company and Howard includes arrangements between the Howard University healthcare system in which the Company paid approximately $314,405 in medical claims during 2021. Additionally, the Company paid $25,000 to Howard’s School of Business, Career Services for participation in Howard’s career recruitment program and sponsorship of a Howard business conference. The relationships described herein did not represent a direct or indirect material interest for Dr. Frederick.

Chrysalis. In 2021, we contracted for services to be provided by certain companies in Chrysalis’ investment portfolio. In each case, the amounts paid under these arrangements were comparable to those for other non-affiliated vendors, were not material to the Company, and did not represent a direct or indirect material interest for Mr. Jones.

Foundation Radiology. Foundation Radiology, a multi-institutional radiology services group, serves as a provider in our network, for which we paid approximately $1.26 million medical claims during 2021, which is an amount that is comparable to other non-affiliated providers for the provision of similar services, is not material to the Company, and does not represent a direct or indirect material interest for Mr. Jones.

Financing Arrangements. Certain of our non-employee directors are partners, shareholders and/or officers of companies that have commercial paper programs or other financing arrangements in which we participate in the ordinary course of business. Payments to or from such companies constituted less than the greater of $200,000 or 1% of each of Humana’s and the recipient’s annual revenue, respectively, in each of the past three years.

At the conclusion of its review for the current year, the Board affirmatively determined that in each case the relationship between the Company or its affiliate and each director-related entity was not material, was below the thresholds for independence prescribed by the NYSE, and did not impact the independence of any of our directors. Directors recused themselves from the independence assessment as the matter was relative to himself or herself. Consistent with these considerations, and based on its review of director independence in light of the standards contained in the Guidelines, the Board determined that each member of the Board of Directors (except Mr. Broussard, as a current employee of the Company) is independent.

Corporate Governance  2022 Proxy Statement  |  Humana

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Committee Membership and Attendance

The Board of Directors has the following standing committees: Audit; Organization & Compensation; Nominating, Governance & Sustainability; Executive; Technology and Investment. Only directors meeting the applicable SEC and NYSE director independence standards and Internal Revenue Code “outside director” criteria may serve on the Audit Committee, the Organization & Compensation Committee, and the Nominating, Governance & Sustainability Committee. Each standing Board committee operates pursuant to a charter, which may be viewed on our website at www.humana.com. From the www.humana.com website, click on “Investor Relations,” then click on “Corporate Governance,” then click on the “Committee Charters” subcategory. The number of Board committee meetings (telephonic and in-person) held in 2021 and membership as of March 1, 2022, were as follows:

Director

     Audit       

 

Organization      

&      

Compensation      

 

 

Nominating      

Governance &       

Sustainability      

 

    Executive      

 Technology       Investment      

Kurt J. Hilzinger

       

 

LOGO   

 

 

 

      

  

Bruce D. Broussard

       

 

LOGO   

 

    

Raquel C. Bono, M.D.

 

 

LOGO   

   

 

      

   

 

LOGO   

  

Frank A. D’Amelio

 

 

LOGO   

   

 

LOGO   

 

      

David T. Feinberg, M.D.1

            

Wayne A. I. Frederick, M.D.

   

 

LOGO   

 

 

 

      

   

 

LOGO   

  

John W. Garratt

 

 

LOGO   

 

         

 

LOGO   

David A. Jones, Jr.

   

 

LOGO   

 

 

 

LOGO   

 

 

 

LOGO   

 

    

Karen W. Katz

     

 

LOGO   

 

   

 

LOGO   

 

  

Marcy S. Klevorn

         

 

LOGO   

  

William J. McDonald

 

 

LOGO   

 

         

 

LOGO   

 

Jorge S. Mesquita

   

 

LOGO   

        

James J. O’Brien

   

 

LOGO   

       

 

LOGO   

 

Marissa T. Peterson

         

 

LOGO   

 

 

 

LOGO   

 

Number of Meetings in 2021

 

 9   6   4   0   5   4  

LOGO  = Chair        LOGO  = Member

1

Elected to the Board effective March 1, 2022.

Audit Committee

Committee Responsibilities

Pursuant to its charter, the Audit Committee:

assists the Board of Directors with the oversight of the integrity of our financial statements and disclosures and internal controls, our compliance with legal and regulatory requirements, the independent registered public accounting firm’s qualifications and independence and the performance of our internal audit function and the independent registered public accounting firm;

bears responsibility for the appointment, compensation, retention and oversight of the work of the independent registered public accounting firm engaged to prepare the audit report or perform other audit, review or attest services;

reviews with the independent registered public accounting firm, our internal audit department, and our financial and accounting personnel, the effectiveness of our accounting and financial controls and, where appropriate, makes recommendations for the improvement of these internal control procedures;

reviews the scope, funding and results of our internal audit function, including the independence and authority of our reporting obligations, the proposed audit plans for the year, and the coordination of these plans with the independent registered public accounting firm;

reviews the scope, funding and results of our Enterprise Risk Management program and compliance program, including receiving, at least quarterly, an update from our Chief Risk Office and internal compliance department regarding any significant matters regarding our risk management and compliance with regulatory requirements and contracts with government entities, respectively;

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collaborates with the Technology Committee to regularly receive updates on risks, and risk mitigation measures, related to Company’s information technology, internal controls, information security, cyber security, business continuity and disaster recovery programs;

reviews the financial statements and other information contained in our Annual Report and other reports to stockholders with management and the independent registered public accounting firm to determine that the independent registered public accounting firm is satisfied with the disclosure and content of the financial statements to be presented to the stockholders and reviews any changes in accounting principles;

confers independently with our internal auditors, Chief Risk Officer, internal compliance department, key members of management, and the independent registered public accounting firm;

determines and approves the appropriateness of the fees for audit and permissible non-audit services performed by the independent registered public accounting firm;

discusses with management our compliance with applicable legal requirements and with our internal policies regarding related party transactions and conflicts of interest;

discusses our policies with respect to risk assessment and risk management;

maintains free and open means of communication between the members of our Board of Directors, the independent registered public accounting firm, our internal audit department, our Chief Risk Officer, our internal compliance department, and our financial management; and

annually evaluates its performance.

Corporate Governance Determinations

The Board of Directors has determined that each of the members of the Audit Committee at February 16, 2022 is independent according to SEC and NYSE requirements, and each is financially literate, as defined in the NYSE listing standards. The Board of Directors has determined further that Messrs. D’Amelio and Garratt and Dr. Bono each meet the definition of “audit committee financial expert.” PricewaterhouseCoopers LLP, our independent registered public accounting firm, reports directly to the Audit Committee. No member of the Board’s Audit Committee serves on the audit committees of more than three publicly traded companies. The Report of the Audit Committee for the year ended December 31, 2021, is set forth in this proxy statement under the caption “Audit Committee Report.”

Organization & Compensation Committee

Committee Responsibilities

Pursuant to its charter, the Organization & Compensation Committee:

reviews and approves our goals and objectives relevant to the compensation of our CEO, evaluates the CEO’s performance in light of those goals and objectives, and, either as a Committee or together with the other independent directors, determines and approves the CEO’s compensation level based on this evaluation;

review and approves all elements of compensation paid to our current or prospective executive officers, including without limitation, base compensation, incentive-compensation plans and equity-based plans, employment, change in control or severance programs and agreements, and any special compensation or benefits, including supplemental retirement benefits and any perquisites;

approves equity-based grants to our executive officers and other associates;

reviews and discusses with management the Company’s compensation plans and policies for all employees (including the Named Executive Officers) with respect to risk management and risk-inducing incentives;

ensures preparation of the Compensation Discussion and Analysis and the Compensation Committee Report as required by SEC regulations;

��

monitors compliance of executive officers and non-employee directors with relevant stock ownership guidelines;

reviews with management periodically, as it deems appropriate, management succession and inclusion and diversity practices;

administers our Executive Management Incentive Compensation Plan and other substantially similar or successor incentive compensation plans; and

annually evaluates its performance.

Corporate Governance  2022 Proxy Statement  |  Humana

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Scope of Authority, Processes and Procedures

The Organization & Compensation Committee acts on behalf of the Board of Directors to establish the compensation of our executive officers and provides oversight of our compensation philosophy, as described in this proxy statement under the caption “Compensation Discussion and Analysis.” The role of the executive officers and the outside compensation consultant in establishing executive compensation is discussed in this proxy statement under the caption “Compensation Discussion and Analysis.” Other than routine administrative matters and the ability of our CEO to approve grants of equity awards subject to certain individual and annual thresholds, no executive compensation decisions are delegated to management.

Compensation Committee Interlocks and Insider Participation

No member of the Organization & Compensation Committee: (i) is or has ever been an officer or employee of the Company; or (ii) is or was, during the last fiscal year, a participant in a “related person” transaction requiring disclosure under Item 404 of the SEC’s regulations (see discussion in this proxy statement under the caption “Certain Transactions with Management and Others”); or (iii) is an executive officer of another entity at which one of our executive officers serves either as a director or on its compensation committee.

Corporate Governance Determinations

During 2021, James J. O’Brien (Chair), Frank J. Bisignano (until April 2021), Wayne A. I. Frederick, M.D. and David A. Jones, Jr. served as members of our Organization & Compensation Committee. Considering (i) the source of each director’s compensation, including any consulting, advisory or other compensatory fees paid by the Company; and (ii) whether each director has an affiliate relationship with the Company, a subsidiary of the Company or an affiliate of a subsidiary of the Company, the Board has determined that each member of the Organization & Compensation Committee at February 16, 2022, is independent, as defined by the SEC and the NYSE, and is considered to be an “outside director” under Section 162(m) of the Internal Revenue Code.

Compensation Risk Determination

In early 2022, the Organization & Compensation Committee reviewed management’s assessment of the risks associated with the Company’s compensation practices and policies for employees, including a consideration of the counterbalance of risk-taking incentives and risk-mitigating factors in Company practices and policies. Following a review of this assessment, the Organization & Compensation Committee determined that the risks arising from the Company’s compensation practices and policies are not reasonably likely to have a material adverse effect on the Company.

Nominating, Governance & Sustainability Committee

Committee Responsibilities

Pursuant to its charter, the Nominating, Governance & Sustainability Committee:

recommends to the full Board criteria for the selection and qualification of the members of the Board;

evaluates and recommends for nomination by the Board candidates to be proposed for election by the stockholders at each annual meeting;

seeks out and assists in the recruitment of highly qualified candidates to serve on the Board;

recommends for Board approval candidates to fill vacancies on the Board which occur between annual meetings;

develops, periodically reviews and recommends to the Board revisions to the Guidelines;

studies and reviews with management the overall effectiveness of the organization of the Board and the conduct of its business, and makes appropriate recommendations to the Board;

reviews the overall relationship of the Board and management;

reviews issues and developments pertaining to corporate governance;

reviews our public policy and political spending practices through regular reviews of our policy on political expenditures, expenditures and payments made with corporate funds, and overall political activity, including review of our Political Contributions and Related Activity Report;

reviews the Company’s programs and policies relating to significant ESG and sustainability matters, and periodically receive updates from the Company’s management regarding significant ESG and sustainability undertakings; and

annually evaluates its performance.

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Executive Committee

Pursuant to its charter, the Executive Committee possesses the authority to exercise all the powers of the Board of Directors except as otherwise provided by Delaware law and our Bylaws during intervals between meetings of the Board. The Executive Committee does not have the power, to, among other things, declare a dividend, issue stock, adopt a certificate of merger or sell substantially all of the Company’s business.

Investment Committee

Pursuant to its charter, the Investment Committee establishes investment objectives and policies for our various investment portfolios and investment options available under various employee benefit plans, reviews investment results, and annually evaluates its performance.

Technology Committee

Pursuant to its charter, the Technology Committee represents and assists the Board of Directors with the oversight of:

our process, awareness, evaluation and perspective on potentially disruptive technologies and convergences that may represent threats or opportunities for our business operations;

our process and perspective on strategic technology capabilities that enable transformational business capabilities;

our process, execution roadmaps, requisite capital, progress in delivering technology-enabled transformational capabilities and their related outcomes; and

management’s focus on organizational, talent and cultural enablers required to ensure achievement of those outcomes.

The Technology Committee has five regular meetings each year, during which senior leadership briefs the Committee and board members on matters relating to the Company’s strategic technology capabilities, including information security capabilities. The Technology Committee may also assist the Audit Committee in its oversight of our information technology internal controls, cyber security, business continuity and disaster recovery programs. Senior leadership provides briefings to the Audit Committee and Technology Committee on information technology controls and risk as least once per year, and separately update the full Board of Directors on cyber security matters at least once per year. Briefings are also provided as-needed in response to industry or company specific developments or material events.

Corporate Governance Policies

Majority Vote Policy

Under our Bylaws, a director nominee will be elected if the number of votes cast for the nominee exceeds the number of votes cast against the nominee. In contested elections, those in which a stockholder has nominated a person for election to the Board, the voting standard is a plurality of votes cast. The Board has also adopted a policy to require the Board to nominate for election only nominees who agree that, if they are elected to the Board, they will tender an irrevocable resignation conditioned on, first, the failure to achieve the required vote for re-election at any future meeting at which they face re-election, and second, the Board’s acceptance of their resignation following that election. In addition, the Board may fill director vacancies and new directorships only with candidates who agree to tender, promptly following their appointment to the Board, the same form of resignation tendered by other directors, as described above. The Nominating, Governance & Sustainability Committee will submit a recommendation for prompt consideration by the Board whether to accept the resignation. Any director whose resignation is under consideration will abstain from participating in any decision regarding that resignation. The Bylaws also require stockholder nominees for director election to notify the Company whether or not such nominees intend to tender the same type of resignation required of the Board’s director nominees.

Change in Director’s Primary Position

The Board has adopted a policy requiring that a director whose primary position or affiliation changes must promptly notify the Board and the Nominating, Governance & Sustainability Committee of the change so that a determination may be made as to the value of his or her continued service on the Board.

Director Stock Ownership Policy

Our Board believes that directors should be stockholders and have a significant personal financial stake in the Company. Consequently, the Board has adopted the following stock ownership guidelines:

Each non-employee director must maintain a minimum equity ownership level of five times the annual cash retainer.

Corporate Governance  2022 Proxy Statement  |  Humana

27


Shares deferred at the election of the director are considered owned for purposes of the calculation of the ownership requirement.

Any Shares owned by a non-employee director (or Shares received upon the exercise of options or vesting of restricted stock or restricted stock units, less an amount to cover the exercise price and/or current tax liabilities) must be held by the director until the minimum equity ownership level is reached and thereafter maintained.

Once the minimum equity ownership level has been achieved, any Shares received upon the vesting of restricted stock or restricted stock units, less an amount to cover current tax liabilities, must be held by the director until one year following the vesting date.

Compliance with these guidelines is monitored by the Organization & Compensation Committee.

Director Attendance

The Board has developed a number of specific expectations of directors to define their responsibilities and to promote the efficient conduct of the Board’s business. With respect to the level of commitment expected of directors and related attendance protocols, as part of the Guidelines, the Board formally adopted a policy that all directors should make every effort to attend all meetings of the Board and the Committees of which they are members, and the Company’s Annual Meeting of Stockholders. Attendance by telephone or video conference may be used to facilitate a Director’s attendance.

During 2021, apart from Committee meetings, the Board of Directors met 10 times. All directors attended at least 75% of the scheduled Board of Directors’ meetings and meetings held by Committees of which they were members. All director nominees serving as directors at that time attended the Annual Meeting of Stockholders held on April 22, 2021.

Executive Sessions of Non-Management Directors

In 2021, our non-management directors held regularly scheduled, formal executive meetings, separate from management and led by our Chairman. Additional executive sessions of the Board are held as necessary or appropriate or upon the request of the Chairman, the Nominating, Governance & Sustainability Committee or any two other non-management directors. In addition, our non-management directors who qualify as independent within the meaning of our director independence guidelines meet in executive session at least once annually, and, in fact, met in 2021 in connection with each regularly scheduled Board of Directors meeting.

Code of Ethics and Code of Business Conduct

The Company has adopted the “Code of Conduct for the Chief Executive Officer and Senior Financial Officers,” which we refer to as the Executive Code of Ethics, violations of which are reported to the Audit Committee. In addition, we operate under the omnibus Humana Inc. Ethics Every Day, which we refer to as the Code of Ethics, which applies to all associates (including executive officers) and directors. The Humana Ethics Office is responsible for the design and enforcement of our ethics policies, the goal of which is to create a workplace climate in which ethics is so integral to day-to-day operations that ethical behavior is self-enforcing. All employees are required annually to review and affirm in writing their acceptance of the Code of Ethics. The Code of Ethics and the Executive Code of Ethics may be viewed on our website at www.humana.com. Any waiver for directors or executive officers from the provisions of the Code of Ethics or the Executive Code of Ethics must be made by the Board of Directors, and will be disclosed within four days of the waiver on our website at www.humana.com. To see either the Code of Ethics or the Executive Code of Ethics or any waivers to either policy, go to www.humana.com, then click on “Investor Relations,” then click on “Corporate Governance,” and then click on the relevant link.

Policy Regarding Employee, Officer and Director Hedging

The Company has a policy prohibiting all associates (including executive officers and independent directors) from hedging or pledging transactions using Company stock, including: (1) engaging in short sales of Company securities; (2) engaging in transactions in puts, calls or other derivative securities designed to hedge or offset any decrease in the market value of the Company’s equity securities, on an exchange or in any other organized market; or (3) engaging in certain monetization transactions, including holding Company securities in margin accounts or pledging Company securities as collateral.

Public Policy

Our Company has an active voice on healthcare policy issues that matter most to the people we serve. From Medicare Advantage, TRICARE and home health; to integrated care, Medicaid and healthcare reform – we are committed to advancing public policy that moves us toward a future in which everyone can enjoy lifelong health and well-being.

The Company has also established and sponsors a Political Action Committee (PAC), for which Company associates may voluntarily contribute. The PAC is registered with the Federal Election Commission (FEC) and certain states nationwide as required by applicable law. As a matter of policy, all Company political activities must promote the interests of the Company, and must be made without regard for the private political preferences of Company officers or executives. Furthermore, Humana does not make independent expenditures nor

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does it contribute to ballot measure committees. Distributions from the PAC are made to federal and state office candidates (and related election committees) or to other PACs on a non-partisan basis when, like the Company, such persons are solution-oriented and believe in building a high-quality, accessible and affordable health care system. The PAC is also committed to supporting diverse candidates at the state and federal level. While the PAC has its own separate board of directors to oversee its operations, the Company’s Board—through its Nominating, Governance & Sustainability Committee—has responsibility for (i) reviewing the political contributions and political activities of the Company and the PAC and (ii) overseeing compliance with the overall policy, process and contribution criteria with respect to such contributions and activities. The Board reviews occur semi-annually, along with semi-annual publication of a Contributions and Related Activity Report (PAC Report). To learn more about our public policy and to review the most recent PAC Report, visit our website at www.humana.com, then click on “About Humana,” then click on “Public Policy.”

Communication with Directors

Stockholders and other interested parties may communicate directly with our Chairman, non-management directors as a group, or any other individual director by writing to the special e-mail address published on our website. Specifically, interested parties may visit our website at www.humana.com then click on “About Humana,” then click on “Contact the Board of Directors,” where instructions for contacting these persons are available. All directors have access to this e-mail address. We use the staff of our Corporate Secretary to review correspondence received in this manner and will filter advertisements, solicitations, spam, and other such items. Concerns related to accounting, internal controls or auditing matters are required to be brought immediately to the attention of our Chief Legal Officer and the Board and handled in accordance with procedures established by the Audit Committee with respect to such matters.

Corporate Governance  2022 Proxy Statement  |  Humana

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Proposal One

Election of Directors

 

The Board of Directors of the Company, in accordance with the provisions of the Company’s ArticlesRestated Certificate of Incorporation and Bylaws, has determined that the number of directors to be elected at the Annual Meeting of the Company shall be thirteen (13)eleven (11). The directors are elected to hold office until the Annual Meeting of Stockholders in 20232025 and until a qualified successor is elected.

Each of the nominees has consented to be named as a nominee and agreed to serve if elected. If any nominee becomes unable to serve for any reason (which is not anticipated), the Shares represented by the proxy granted to Messrs. Hilzinger and Broussard may be voted for the substituted nominee as may be designated by the Board of Directors. The Board has established a policy that non-employee directors must retire at the first annual meeting following his or her seventy-third birthday. To encourage director refreshment, there are no exemptions or conditions in this policy.

The following charts and tables showtable shows certain information concerning the nominees at March 1, 2022.2024.

 

Name

 Age     Age     Position    Position

First Elected

Director

Kurt J. Hilzinger

6163

Chairman of the Board, Independent Director

07/2003

Bruce D. Broussard

5961

Director, President and Chief Executive Officer

01/2013

Raquel C. Bono, M.D.

6567

Independent Director

09/2020

Frank A. D’Amelio

6466

Independent Director

09/2003

David T. Feinberg, M.D.

5961

Independent Director

03/2022

Wayne A.I. Frederick, M.D.

5052

Independent Director

02/2020

John W. Garratt

5355

Independent Director

02/2020

David A. Jones, Jr.

64

Independent Director

05/1993

Karen W. Katz

6567

Independent Director

09/2019

Marcy S. Klevorn

6264

Independent Director

02/2021

William J. McDonald

65

Independent Director

10/2007

Jorge S. Mesquita

6062

Independent Director

02/2021

James J. O’BrienBrad D. Smith

6759

Independent Director

04/200609/2022

Vote Required and Recommendation of the Board of Directors

A director nominee will be elected if the number of votes cast for the nominee exceeds the number of votes cast against the nominee. Shares not present at the Annual Meeting and Shares voting “abstain” or broker non-votes have no effect on the election of directors. Under the Company’s Majority Vote Policy, following a director’s initial election to our Board of Directors, athe director is required to submit his or her irrevocable resignation to our Board of Directors, conditioned upon (i) the director not achieving the requisite stockholder vote at any future meeting at which they face re-election, and (ii) acceptance of the resignation by the Board of Directors following that election. The Board of Directors has 90 days to determine whether or not to accept the director’s resignation and to report this information to our stockholders.

LOGO

FOR THE REASONS STATED HEREIN, THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR ALL NOMINEES.

 

304  

Humana | 20222024 Proxy Statement Proposal One

 


Director SkillsAttributes and Qualifications

The Nominating, Governance & Sustainability Committee (“Committee”) regularly assessesevaluates the skills and experiences necessary to ensure that theour Board has appropriate skill compositionrepresents a diverse group of individuals with a range of skills, experiences and expertise to oversee the Company’s long-term business strategy, operations, and risks. The Committee recognizes that our Board should represent a diverse groupThis analysis includes the identification of individuals who bring a rangethe non-exhaustive list set forth below of experience, skills and other attributes to their individual role on the Board and to the Board as a collective group. On an annual basis, the Committee assesses each Board candidate to determine whether to recommend currently serving directors for reelection to the Board and whether to recommend candidates for initial election to the Board. In assessing a director nominee, the Committee considers the appropriate balance of experience, skills and other qualifications required for service on our Board, including (i) core attributes that are expected of our directors, and (ii) substantive areas of expertise indicating specific skills, experience or qualifications most closely aligned to our strategic priorities. On an annual basis, the Committee holistically assesses each director nominee, and the Board as a whole, to ensure that should bean appropriate balance of skills, experiences, and backgrounds are represented collectively on our Board. Although not an exhaustive assignment of skills and attributes, we have highlighted for each director the substantive areas of expertise that they bring to the Board in the biography of each nominee located in the section entitled “Director Nominee Biographies.”

 

LOGOCore Director Attributes LOGO Substantive Areas of Expertise

LOGO

Independent under our Corporate Governance Guidelines, as well as meeting the independence requirements of, as applicable, the NYSE, SEC, IRS;and IRS

 

 

LOGO

 

   Public company experience in position of CEO, CFO or other C-suiteCOO (including oversight/supervisory experience with significant business acumen;

of persons in such positions)

LOGO

External public company board service is limited (maximum of three);three for a non-CEO director; maximum of one for a CEO director – in each case, not including the Company)

 LOGO

 Financial expertise/capital markets experience;

   Corporate governance (including Board of Directors experience, sustainability, and environmental, social and related-governance (ESG))

LOGO

Risk oversight ability with respect to the particular skills of the individual director;director

 LOGO

 Corporate governance/Board of Directors experience;

   Health care industry experience (including clinical practice)

LOGO

Understanding of and experience with complex public companies or like organizations;organizations

 LOGO

 

Information technology and digital innovation; data privacy, cyber security, and/or general business compliance;privacy; and cybersecurity

LOGO

Standing and reputation in the individual’s field;field

 LOGO

 Health care industry

   Government relations, public policy and regulatory experience including clinical practice;

LOGO

Ability to work collegially and collaboratively with other directors and our management team;

LOGOProduct design and growth models, consumer marketing/orientation;
LOGOteam

 

 

High integrity and ethical standards; and

LOGO 

Government relations, public policy   Marketing and regulatory experience;consumer insights (including product design and

growth models);

LOGO

A commitment to diversity, equity and inclusion (DEI).

LOGO 

 

Strategy development.   Financial oversight (including capital markets experience)

   High integrity and ethical standards

   Capital allocation and corporate transactions

The Committee further assesses each director nominee’s ability to devote sufficient time and effort to his or her duties as a director, his or her willingness to consider all strategic proposals, and any core competencies or technical expertise necessary to staff Board committees. This annual assessment may also incorporate responses, as appropriate, from the Board’s annual individual self-evaluations. More information about the Board self-evaluation process can be found in the section entitled “Board Evaluation Process.Practices.” The director nominee analysis also helps to determine whether a nominee would meet the criteria for independence set forth in the Corporate Governance Guidelines established by the Board and in accordance with independence requirements of the NYSE and the SEC.

The Committee has determined thatfollowing matrix summarizes the most significant skills, attributes and experiences represented on our diverse, knowledgeable, and experienced Board. More information about each of our independent director nominees satisfies all ofcan be found in the core director attributes set forth above.section entitled “Director Nominee Biographies.”

LOGOLOGOLOGOLOGOLOGOLOGOLOGOLOGOLOGOLOGOLOGO
Public Company CEO, CFO, or COO Experience
Financial Oversight
Corporate Governance
Healthcare Industry Experience
Capital Allocation and Corporate Transactions
IT/Digital; Data Privacy; Cyber
Marketing/Consumer Insights
Government Relations/ Public Policy
Strategy Development
Risk Assessment
Sustainability/ESG

Proposal One 2024 Proxy Statement | Humana

5


Board Composition and Refreshment

The Committee and the Board Tenurefollow a thoughtful refreshment process to ensure the Board composition best reflects the most appropriate mix of skills and Refreshment

experiences to perform strong oversight of the Company’s strategic priorities. The Committee and the Board strive to maintain a balance of tenure on the Board. Longer-serving directors bring valuable experience and a deep understanding of our complex business and industry, along with a historical perspective of our long-term successes, challenges and business cycles, and how these past experiences may inform our current strategy. Newer directors are also critical to the advancement of our strategy, bringing new skills and experiences and contributing fresh perspectives. The Board has established a policy that non-employee directors must retire at the first annual meeting following his or her seventy-third birthday. To encourage director refreshment, there are no exemptions or conditions in this policy.

As further shown below, our Board has undergone significant refreshment in recent years. Since January 2017, ten new directors have been appointed to our Board. Eight of those directors are standing for election this year, all of whom are independent and joined the Board since 2019, deepening the Board’s C-Suite experience, financial expertise, healthcare industry experience, technology expertise, consumer perspective, and public policy expertise while also building on the Board’s focus on diversity.

LOGO

In addition, during 2022 and 2023 our Board refreshed the leadership and composition of our Nominating, Governance & Sustainability Committee, Organization & Compensation Committee, and Technology Committee. The Board also formed our Clinical Quality Committee, as the Board continues to adapt its work and oversight as we advance the Company’s strategy.

Regarding diversity, our Company and our Board actively promote and foster a culture of inclusion and diversity to enable an environment where the unique characteristics, backgrounds and beliefs of our teammates can drive the groundbreaking, strategic thinking that gives our Company its competitive edge in a diverse marketplace.

Our Board does not establish specific goals with respect to diversity; rather, the Board’s diversity is a consideration in the overall director nomination process and is a component of the overall assessment of the Board’s composition and effectiveness. Under the Nominating, Governance & Sustainability Committee Charter, the Board has further committed to include, and require any third-party search firm that it engages to include, candidates with diversity of race, ethnicity and gender in the slate of candidates considered by the Committee and/or the Board for nomination to the Board.

6

Humana | 2024 Proxy Statement Proposal One


The illustrations below depict independence, age, tenure and tenurediversity represented in the current composition of our director nominees.

 

Independence
LOGO

Age

LOGO
     
Director Independence Director Age Distribution Board Tenure
  

 

91%

 

 

62

Years

 

 

6.67

Years

Average director tenure

 

73%

Of directors have served < 5 years

 

27%

Of directors have served 10 years,
including our CEO

 

Of our directors are independent and we have an independent Chairman of the Board

(10 of 11 directors)

 

Average age of director nominees

(Age Range: 52 – 67)

   

 

Gender Representation

 

 

Race/Ethnicity Representation

 

27%

 

 

18%

Of our directors are women

(3 of 11 directors)

 

Of our directors are racially and/or ethnically diverse

(2 of 11 directors)

 

(Based on service as of March 1, 2024)

   

Proposal One  2022 Proxy Statement  |  Humana

31


Our Board has undergone significant refreshment in recent years. Since January 2017, nine new directors have been appointed to our Board. Seven of those directors are standing for election this year, all of whom are independent and joined the Board since 2019, deepening the Board’s financial expertise, consumer perspective, healthcare industry experience, technology expertise and C-Suite experience while also building on the Board’s focus on diversity.

LOGO

Diversity

Humana and our Board actively promote and foster a culture of inclusion and diversity to enable an environment where the unique characteristics, backgrounds and beliefs of our teammates can drive the groundbreaking, strategic thinking that gives our Company its competitive edge in a diverse marketplace.

Our Board does not establish specific goals with respect to diversity; rather, the Board’s diversity is a consideration in the overall director nomination process and is a component of the overall assessment of the Board’s composition and effectiveness. Under the Nominating, Governance & Sustainability Committee Charter, we have further committed to include, and require any third-party search firm that it engages to include, candidates with diversity of race, ethnicity and gender in the slate of candidates considered by the Committee and/or the Board for nomination to the Board. The illustration (at right) depicts certain diversity represented in the current composition of our director nominees.

LOGO

Identifying Nominees for Directors

The Board has delegated an established screening process for director nominees to the Nominating, Governance & Sustainability Committee, with counsel from our Chairman, our Chief Executive Officer, and outside consultants as appropriate. The goal of the screening process is to assemble a group of potential board members with deep, varied experience, sound judgment, and commitment to the Company’s success.

The Committee receives notice of potential candidates through any of the following avenues: (i) Board self-identification; (ii) third-party recommendations; and (iii) stockholder nominations.recommendations. While director nominees may be presented to the Board for consideration by the Committee through any of these methods, the Board is ultimately responsible for assessing the needs of the Board, appointing candidates to the Board, and nominating candidates for election by our stockholders at our annual meeting. Once the Committee has compiled its group of suitable candidates and conducted appropriate diligence, it then meets with the Board to review the candidates for further consideration.

Board Self-Identification. The Committee regularly assesses the appropriate size of the Board, the areas of expertise required to effectively contribute to the Board process, and whether any vacancies are anticipated. It also annually assesses the director qualification criteria to ensure the Board has appropriate skill composition aimed at the Company’s long-term business strategy, operations, risks, thought and perspective. As a result, the Committee may recommend to the Board a need for an additional director, Board refreshment for certain requisite skills and qualifications, and/or suggest the replacement of an existing director for other credible reasons.

Third-Party Recommendations. From time to time, the Committee engages a professional third-party search firm to assist the Board of Directors and the Committee in identifying and recruiting candidates for Board membership.

Stockholder Nominees. The policy of the Committee is to consider properly submitted stockholder nominationsrecommendations for candidates for membership on the Board as described above under “Identifying Nominees for Directors.” Stockholder nominationsIn addition, stockholders may nominate candidates for election to the Board of Directors are governed byin accordance with the specific provisions in our Bylaws, a copy of which is available on our website at www.humana.com. From the www.humana.com website, then click on “Investor Relations,“More Humana,andthen click on “For Investors,” then click on “Corporate Governance,” and then click on the link entitled, “Bylaws.” The Bylaws require that a stockholder provide written noticeA summary of intent to nominate a candidatethese provisions, which include customary provisions for director no less than 60 days or more than 90 days prior to the scheduled dateinclusion of candidates in our proxy statement (proxy access) is included in the Annual Meeting of stockholders. If less than 70 days’ notice of the Annual Meeting is given, written notice by a stockholder would be deemed timely if made no later than the 10th day following such notice of the Annual Meeting. Any stockholder nominations proposed for consideration by the Committee should include, among other information required by the Bylaws, the nominee’s name, qualifications for Board membership and compliance with our Director Resignation Policy discussed in“Frequently Asked Questions” section within this proxy statement and should be sent tounder the attention ofcaption “What is the Corporate Secretary, Humana Inc., 500 West Main Street, 21st Floor, Louisville, Kentucky 40202.due date for stockholder nominees for director for the Company’s 2025 Annual Meeting.”

 

32

Proposal One 2024 Proxy Statement | Humana

   

Humana  |  2022 Proxy Statement  Proposal One

7


Board of Directors Nominee Determination

At the recommendation of the Nominating, Governance & Sustainability Committee, the Board has nominated 13eleven (11) individuals for this year’s election. The Board believes that each director nominee possesses and demonstrates the character, integrity, independence, business judgment and all other requisite skills, qualifications and attributes necessary to effectively (i) act in the best interests of the Company and its stockholders and (ii) exercise active and independent oversight of the of the Company’s management team, business affairs and assets. As a group, the director nominees’nominees create a diverse, knowledgeable and experienced Board with strong executive experience,experience; financial expertise,expertise; knowledge and experience in healthcare,healthcare; expertise in information systems; protection and digital innovation and technology,innovation; and consumer orientation necessary to oversee the Company’s business and the execution of our strategy.

We believe that the current Board members have a deep commitment to the Company’s success, as evidenced by the key qualifications, skills, experiences and diversity of backgrounds of each director described below. The information given in this proxy statement concerning the nominees is based upon statements made or confirmed to the Company by or on behalf of the nominees.

8

Humana | 2024 Proxy Statement Proposal One


Director Nominee Biographies

 

 

Kurt J. Hilzinger

  

 

White Male, Age 6163 Director since 2003

 
 

LOGOLOGO

Chairman of the Board

Independent Director

 

 

 

Kurt J. Hilzinger was initially elected to the Board in July 2003, and was elected Chairman of the Board effective January 1, 2014. Mr. Hilzinger served as Lead Director from August 2010 until his appointment as Chairman. Mr. Hilzinger is a Partner at Court Square Capital Partners, an independent private equity firm, having held this position since November 2007. At Court Square, Mr. Hilzinger focuses principally on investments in the healthcare industry. Prior to that, he was a Director of AmerisourceBergen Corporation from March 2004 to November 2007; having previously served as President and Chief Operating Officer of AmerisourceBergen Corporation from October 2002 to November 2007, and as Executive Vice President and Chief Operating Officer from August 2001 to October 2002. Mr. Hilzinger also serves on the Board of Directors of Outlook Therapeutics, Inc. and several privately held companies.

Other Public Boards: 1

Committees

 No Committee Roles

 

The Board believes that Mr. Hilzinger is a strong operating executive with a finance and strategic background, whose operational experience and financial expertise in the health care sector contributes valuable insight to the Board.

 

 
  Committees  Skills & Qualifications     
 

 

  ExecutiveBruce D. Broussard

  

 

  Financial Oversight

  Healthcare Industry Experience

  Global Experience

  Strategy Development

  Corporate Governance

  Risk Assessment

Proposal One  2022 Proxy Statement  |  HumanaWhite Male, Age 61 Director since 2013

 

   33


 

Bruce D. BroussardLOGO

 

Age 59    Director, since 2013

LOGO

Director, President and

Chief Executive Officer

 

Other Public Boards: 1

 

 

Bruce D. Broussard, President and CEO,Chief Executive Officer, joined Humana in 2011. Under his leadership, Humana has created an integrated care delivery model centered on improving health outcomes, driving lower costs, enhancing quality, and providing a simple and personalized member experience. With its holistic, human care approach, Humana is dedicated to improving the health of the communities it serves by making it easier for people to achieve their best health.

 

Bruce brings to Humana a wide range of executive leadership experience in publicly traded and private organizations within a variety of healthcare sectors, including oncology, pharmaceuticals, assisted living/senior housing, home care, physician practice management, surgical centers and dental networks. Prior to joining Humana, Bruce was Chief Executive Officer of McKesson Specialty/US Oncology, Inc. US Oncology was purchased by McKesson in December 2010. At US Oncology, Bruce served in a number of senior executive roles, including Chief Financial Officer, President, Chief Executive Officer and Chairman of the Board.

 

Bruce plays a leadership role in key business advocacy organizations such as the Business Roundtable, the Business Council, and the American Heart Association CEO Roundtable. He is a member of the Board of Directors of HP Inc., and is a member and previous chair of America’s Health Insurance Plans (AHIP).AHIP. Additionally, Bruce serves on the Board of the Trust for the National Mall, a nonprofit philanthropic partner of the National Park Service dedicated to restoring and preserving the National Mall.

Committees

 No Committee Roles

 

The Board believes that Mr. Broussard’s wide range of executive leadership experience in publicly traded and private organizations within a variety of healthcare sectors, including oncology, pharmaceuticals, assisted living/senior housing, home care, physician practice management, surgical centers, and dental networks, as well as his in-depth knowledge of the Company’s operations, finances and strategy, brings valuable insight to the Board.

 

 
  Committees  Skills & Qualifications     

  Executive (Chair)

  Healthcare Industry Experience

  CEO Experience

  Strategy Development

  Corporate Governance

  Risk Assessment

  Consumer Design/Digital Orientation

  Government Relations/Public Policy

 

34

Proposal One 2024 Proxy Statement | Humana

   9


Humana  |  2022 Proxy Statement  Proposal One

Raquel C. Bono, M.D.

 


Asian Female, Age 67 Director since 2020

 

Raquel C. Bono, M.D.LOGO    

 

Age 65    Director since 2020

LOGO

Independent Director

 

Other Public Boards: 1

 

 

 

Raquel C. Bono, M.D., was initially elected to the Board in September 2020. SheDr. Bono is a Principal at RCB Consulting having held this position since October 2019, as well2019. Dr. Bono most recently served as Chief Health Officer at Viking having held this position sinceCruises from November 2020.2020 until her retirement in December 2023. Prior to Viking Cruises, Dr. Bono, a board-certified trauma surgeon and retired Vice Admiral, U.S. Navy Medical Corps, previously served as the Chief Executive Officer and Director for the Defense Health Agency (DHA). In this capacity, Dr. Bono led a joint, integrated combat support agency that enables all branches of the U.S. military medical services to provide health care services to combatant commands in times of both peace and war. Dr. Bono integrated an unprecedented $50 billion worldwide health care enterprise for the Army, Navy, Air Force, and Marine Corps, composed of 50 hospitals and 300 clinics that provide care to 9.5 million military personnel, oversaw the Department of Defense deployment of the electronic health record, and facilitated the collaboration between the largest federated health systems of the Department of Defense and Department of Veterans Affairs (VA). An American College of Surgeons (ACS) Fellow since 1991, Dr. Bono served on the ACS Board of Governors and the Governors Health Policy and Advocacy Workgroup. She has been honored with the Defense Distinguished Service Medal, three Defense Superior Service Medals, four Legion of Merit Medals, two Meritorious Service Medals, and two Navy and Marine Corps Commendation medals. Dr. Bono alsocurrently serves on boardsthe Board of several privately held companies.Directors of Alcon, Inc.

Committees

 Audit

 Clinical Quality

 

The Board believes that Dr. Bono’s decorated military service and distinguished and successful career in trauma surgery and healthcare administration bring an important perspective to Humana’s Board and further contribute to its strategic composition. Dr. Bono’s extensive operational expertise and discipline in managing and advancing healthcare delivery systems will be vital as the Company continues to evolve its clinical and care delivery strategies.

 

 
  Committees

Frank A. D’Amelio

 

White Male, Age 66 Director since 2003

 Skills & Qualifications

 

  AuditLOGO    

  Technology

  Financial Oversight

  Healthcare Industry Experience

  Risk Assessment

  Executive Experience

  Global Experience

  Strategy Development

  Government Relations/Public Policy

Frank A. D’Amelio

Age 64    Director since 2003

LOGO

Independent Director

 

Other Public Boards: 3

 

 

 

Frank A. D’Amelio was initially elected to the Board in September 2003. He isMr. D’Amelio was formerly Executive Vice President, Chief Financial Officer at Pfizer Inc. having held this position sincefrom January 2022 until May 2022. Mr. D’Amelio began his career at Pfizer in 2007 and since then has held various roles of increasing responsibility, including, SVP & Chief Financial Officer (September 2007-December 2010), Executive Vice President, Business Operations and Chief Financial Officer (January 2011-October 2018) and Chief Financial Officer and Executive Vice President, Global Supply (November 2018-December 2021). Prior to that, Mr. D’AmelioD��Amelio was Senior Executive Vice President of Integration and Chief Administrative Officer at Alcatel-Lucent from December 2006 to August 2007, and Chief Operating Officer of Lucent Technologies Inc. from February 2006 to November 2006. From May 2001 until January 2006, he was Executive Vice President, Administration and Chief Financial Officer of Lucent. Mr. D’Amelio also serves on the Board of Directors of Zoetis, Inc., Hewlett Packard Enterprises and on the board of the Independent Colleges and Universities of New Jersey.Catalent, Inc.

Committees

 Audit (Chair)

 Nominating, Governance
& Sustainability

 

The Board believes that Mr. D’Amelio’s skills, global experience and proven leadership in both financial and operational roles contribute greatly to the Board’s composition. As a senior executive at various global companies undergoing the kind of rapid and complex changes that the Company has undertaken in response to the rapidly changing markets and regulatory environment, Mr. D’Amelio has extensive knowledge of the capital markets as well as broad experience working with the investment community, regulatory bodies and rating agencies.

 

 
  Committees

10  Skills & Qualifications Committees

Humana | 2024 Proxy Statement Proposal One


  Audit (Chair)

  Nominating, Governance & SustainabilityDavid T. Feinberg,
M.D.

  

 

  Financial Oversight

  C-Suite Experience

  Global Experience

  Healthcare Industry Experience

  Corporate Governance

  Risk Assessment

  Strategy Development

  Government Relations/Public Policy

  Compliance

Proposal OneWhite Male, Age 61 Director since 2022 Proxy Statement  |  Humana

 

 35


 

David T. Feinberg, M.D.LOGO

 

Age 59    Director since 2022

LOGO

Independent Director

Other Public Boards: 1

 

 

David T. Feinberg, M.D., was initially elected to the Board in March 2022. Dr. Feinberg is Chairman of Oracle Health, where he is committed to making healthcare more accessible, affordable, and equitable. His work advances thought leadership and strategy related to unleashing the healing power of data through an open and connected healthcare ecosystem. Previously, Dr. Feinberg served as President and Chief Executive Officer and member of the Board of Directors of Cerner Corporation (Cerner) having held these positions since October 1, 2021., which is now Oracle Health. In thisthat role Dr. Feinberg focusesfocused on delivering tools and technology thatto help caregivers optimize the health of their patients and communities.

 

Dr. Feinberg joined Cerner from Google, where he held the position of Vice President of Google Health since 2019 and led Google’s worldwide health efforts, bringing together groups from across Google and Alphabet that used artificial intelligence, product expertise and hardware to tackle some of healthcare’s biggest challenges, and was responsible for organizing and innovating Google’s various healthcare initiatives. Prior to Google, he served as President and CEO of Geisinger Health where he led an operational turnaround, and pushed the use of new platforms and tools, including an IT system called a Unified Data Architecture that allowed the company to integrate big data into existing data analytics and management systems. During his Geisinger tenure, Dr. Feinberg also introduced programs and services to put a greater focus on precision medicine and better patient care. Prior to Geisinger, Dr. Feinberg worked at UCLA for more than 20 years and served in a number of leadership roles, including President, CEO and Associate Vice Chancellor of UCLA Health Sciences, Vice Chancellor and CEO for the UCLA Hospital System, and CEO of UCLA’s Ronald Reagan Medical Center.

 

Dr. Feinberg earned his undergraduate degree at the University of California, Berkeley. He graduated with distinction from the University of Health Sciences/Chicago Medical School. He completed an internship in pediatrics at Loyola University Medical Center, and residency and fellowship training in psychiatry, addiction psychiatry, and child and adolescent psychiatry at the UCLA School of Medicine. He earned a Master of Business Administration from Pepperdine University. Dr. Feinberg is a member of the Alpha Omega Alpha Medical Honor Society, a Distinguished Fellow of American Psychiatric Association and received the Cancro Academic Leadership Award from the American Academy of Child & Adolescent Psychiatry. Dr. Feinberg also serves on the Board of Directors of Douglas Emmett Inc.

 

Committees

 Clinical Quality (Chair)

 Nominating, Governance
& Sustainability

The Board believes that Dr. Feinberg’s experience leading healthcare organizations focused on leveraging technology and digital innovation to improve clinical care, including public and private companies, brings valuable insights to the Board and further contribute to its strategic composition. Dr. Feinberg’s clinical background, patient-centric mindset, operating experience, and expertise in guiding systems transformations qualify him to offer key perspectives as the Company continues to advance the integration of its clinical systems and care models to improve the customer experience and reduce costs.

 

  Committees 
 Skills & Qualifications    

  No Current Committees

  

  CEO Experience

  Healthcare Industry Experience

  Global Experience

  Strategy Development

  Corporate Governance

  Technology

  Consumer Design/Digital Orientation

 

36

Proposal One 2024 Proxy Statement | Humana

   

Humana  |  2022 Proxy Statement  Proposal One

11


 

Wayne A. I. Frederick,
M.D.

  

 

Black Male, Age 5052 Director since 2020

 

LOGO

LOGO

Independent Director

Other Public Boards: 3

 

 

 

Wayne A. I. Frederick, M.D., was initially elected to the Board in February 2020. HeDr. Frederick is the President Emeritus of Howard University, having held this position sincepreviously served as the 17th President from July 2014.2014 - September 2023, and is the distinguished Charles R. Drew Professor of Surgery at the Howard University College of Medicine. He is also a practicing cancer surgeon at Howard University Hospital. Prior to that Dr. Frederick served as Howard University’s Interim President (elected October 2013) after serving as Provost and Chief Academic Officer for more than a year. Following his post-doctoral research and surgical oncology fellowships at the University of Texas MD Anderson Cancer Center, Dr. Frederick began his academic career as Associate Director of the Cancer Center at the University of Connecticut. Upon his return to Howard University, his academic positions included Associate Dean in the College of Medicine, Division Chief in the Department of Surgery, Director of the Cancer Center and Deputy Provost for Health Sciences. He also earned a Master of Business Administration degree from Howard University’s School of Business in 2011. Dr. Frederick continues to operate and lectures to the medical students and residents of Howard University’s College of Medicine. Dr. Frederick is a fellow of the American College of Surgeons (ACS) and belongs to numerous surgical and medical organizations, including, the ACS’ Academy of Master Surgeon Educators, the American Surgical Association.Association and the National Academy of Medicine. Dr. Frederick also serves on the Board of Directors of Agostini Limited, Insulet Corporation, Workday, Inc. and Mutual of America Life Insurance Co., Forma Therapeutics Holdings, Inc. and Insulet Corporation in addition to a few other privately held companies and charitable organizations.

Committees

 Organization &
Compensation (Chair)

 Clinical Quality

 

The Board believes that Dr. Frederick’s exemplary career as a leader in medical research, healthcare academics and business administration brings valuable insights to the Board to assist in the advancement of its strategic healthcare goals. Dr. Frederick’s extensive healthcare and disease management background will be instrumental to our company’s relationships with our members and our physician partners, as Humana continues to innovate in the area of health data analytics.

 

  Committees 
 Skills & Qualifications 

 

  Organization & CompensationJohn W. Garratt

  Technology

  

 

  Healthcare Industry Experience

  Executive Experience

  Strategy Development

  Government Relations/Public Policy

John W. Garratt

White Male, Age 5355 Director since 2020

 

LOGO

Independent Director

Other Public Boards: 2

 

 

 

John W. Garratt was initially elected to the Board in February 2020. He isMr. Garratt was formerly the Executive Vice President and Chief Financial Officer of Dollar General Corporation, having held this position since December 2015.from September 2022 to June 2023. Mr. Garratt joined Dollar General in October 2014 as Senior Vice President, Finance & Strategy and subsequently served as Interim Chief Financial Officer from July 2015 to December 2015.2015 and most recently served as Executive Vice President and Chief Financial Officer from December 2015 to September 1, 2022. Prior to joining Dollar General, Mr. Garratt held various positions of increasing responsibility with Yum! Brands, Inc., one of the world’s largest restaurant companies, between May 2004 and October 2014, holding leadership positions in corporate strategy and financial planning. Mr. Garratt served as Vice President, Finance and Division Controller for the KFC division and earlier for the Pizza Hut division and for Yum Restaurants International between October 2013 and October 2014. Mr. Garratt also served as the Senior Director, Yum Corporate Strategy, from March 2010 to October 2013, reporting directly to the corporate Chief Financial Officer and leading corporate strategy as well as driving key cross-divisional initiatives. Mr. Garratt served in various other financial positions at Yum from May 2004 to March 2010. Prior to his career at Yum! Brands, Mr. Garratt served as Plant Controller for Alcoa Inc. between April 2002 and May 2004, and held various financial management positions at General Electric from March 1999 to April 2002. He began his career in May 1990 at Alcoa, where he served for approximately nine years. Mr. Garratt also serves as a Class B Directoron the Board of the Federal Reserve BankDirectors of Atlanta.Papa John’s International, Inc. and Cracker Barrel Old Country Store, Inc.

Committees

 Investment (Chair)

 Audit

 

The Board believes that Mr. Garratt’s substantial executive leadership at large public companies, combined with his extensive experience in key areas of finance, accounting, strategic planning and business analytics, supplement existing expertise essential to the Board‘s oversight function as Humana continues to evolve its population health and care delivery strategies. Mr. Garratt’s contributions to organizations across varied consumer-based industries further qualifies him to offer key perspectives as the Company enhances products and capabilities for our members.

 

  Committees

12  Skills & Qualifications    

Humana | 2024 Proxy Statement Proposal One


  Investment (Chair)

  AuditKaren W. Katz

  

 

  Financial Oversight

  C-Suite Experience

  Corporate Governance

  Risk Assessment

  Strategy Development

  Product Design and Growth Models

Proposal One  2022 Proxy Statement  |  HumanaWhite Female, Age 67 Director since 2019

 

 37


 

David A. Jones, Jr.

Age 64    Director since 1993

LOGOLOGO

Independent Director

Other Public Boards: 2

 

 

 

David A. Jones, Jr. was initially elected to the Board in May 1993 and served as Chairman of the Board of the Company from April 2005 through August 2010, and Vice Chairman of the Board from September 1996 through April 2005. He is Chairman of Chrysalis Ventures, LLC, headquartered in Louisville, Kentucky, and also serves on the board of directors of several charitable, civic and privately held companies.

 

As a successful venture capitalist, the Board believes that Mr. Jones brings strategic insight and leadership and a wealth of experience in health care to the Board, both in the Company’s core businesses as well as in emerging technologies and business models.

  CommitteesSkills & Qualifications    

  Nominating, Governance & Sustainability (Chair)

  Organization & Compensation

  Executive

  Healthcare Industry Experience

  Corporate Governance

  Strategy Development

  Financial Oversight

  Global Experience

  Risk Assessment

  Legal/Compliance

Karen W. Katz

Age 65    Director since 2019

LOGO

Independent Director

Karen W. Katz was initially elected to the Board in September 2019. Ms. Katz was formerlymost recently interim CEO of Intermix, LLC from June 2022 to December 2022. Prior to Intermix, Ms. Katz served as the President and CEO of Neiman Marcus Group LTD LLC from 2010 to February 2018. Neiman Marcus Group is an international multibrand omni-channel retailer whose portfolio of brands includes Neiman Marcus, Bergdorf Goodman and MyTheresa. Having joined Neiman Marcus in 1985, Ms. Katz served in key executive and leadership roles in the company’s merchant, stores and eCommerce organizations as Executive Vice President—Stores, a member of the Office of the Chairman of Neiman Marcus Group, and President, Neiman Marcus Online, and President and CEO, Neiman Marcus Stores. Ms. Katz currently serves on the Board of Directors of Under Armour, Inc. and The RealReal, Inc.

 

Committees

 Nominating, Governance
& Sustainability (Chair)

 Organization &
Compensation

The Board believes that Ms. Katz is an extremely accomplished executive with deep experience and a demonstrated commitment to understanding, and meeting, the needs of customers by maintaining a personalized experience enabled by digital transformation. She brings a holistic approach to customer service, including acumen for employing technology to advance service delivery, combined with demonstrated success in growing business through forward thinking leadership, providing valuable perspective and expertise to the Board.

 

  Committees 
 Skills & Qualifications 

  Nominating, Governance & Sustainability

  TechnologyMarcy S. Klevorn

  

 

  Financial Oversight

  CEO Experience

  Global Experience

  Strategy Development

  Corporate Governance

  Consumer Design/Digital Orientation

  Marketing

  Risk Assessment

  Product Design and Growth Models

38

Humana  |  2022 Proxy Statement  Proposal One


Marcy S. Klevorn

White Female, Age 6264 Director since 2021

 

LOGO

LOGO

Independent Director

Other Public Boards: 2

 

 

 

Marcy S. Klevorn was initially elected to the Board in February 2021. Ms. Klevorn was formerly the Chief Transformation Officer of Ford Motor Company (Ford) from May 2019 until her retirement in October 2019. In this role, she accelerated the company’s transformation by helping to refine its corporate governance systems, facilitate faster adoption of agile teams across the business and ensure process improvements across the enterprise. She also facilitated strategic partnerships with key technology partners and supported the company’s diversity efforts. Having joined Ford Motor Company in 1983, Ms. Klevorn served in key executive and leadership roles within the company’s information technology organization including Director of the Office of the Chief Information Officer and Group Vice President of Information Technology, where she oversaw the transformation of Ford’s IT tools and talent.Technology. Ms. Klevorn also served as Executive Vice President and President of Ford Smart Mobility LLC, a division of Ford Motor Company, where she oversaw certain acquisitions and other investments and helped to accelerate the company’s plans to design, build, grow and invest in emerging mobility services and global data insight and analytics. Ms. Klevorn currently serves on the Board of Directors of Northern Trust Corporation.Corporation and Cerence Inc. in addition to a few privately held companies.

Committees

 Technology (Chair)

 Audit

 

The Board believes that Ms. Klevorn’s extensive executive experience and leadership in digital innovation and systems transformation brings valuable insights to the Board as the Company continues to enhance its technology-driven platforms for members and providers. Ms. Klevorn’s deep understanding of information technology, cyber security, and systems management and infrastructure, combined with her proven ability to connect systems to strategy execution qualify her to provide key insights in the Company’s consumer-focused approach to care.

 

  Committees 
 Skills & Qualifications 

  Technology

 

  C-Suite Experience

  Global Experience

  Strategy Development

  Risk Assessment

  Technology

  Consumer Design/Digital Orientation

William J. McDonald

Age 65    Director since 2007

LOGO

Independent Director

William J. McDonald was initially elected to the Board in October 2007. Mr. McDonald is the managing partner of Wild Irishman Advisory, LLC, a marketing consulting firm. Prior to that, he was Executive Vice President, Brand Management of Capital One Financial Corporation, having held that position from 1998 until his retirement in 2013. Mr. McDonald also serves on the advisory board of The University of Texas at Austin Longhorn Family Leadership Council.

The Board believes that Mr. McDonald’s service in various senior executive marketing positions contributes significant experience and expertise in brand development, marketing and related disciplines.

  CommitteesSkills & Qualifications

  Audit

  Investment

  Executive Experience

  Marketing

  Strategy Development

  Corporate Governance

  Consumer Design/Digital Orientation

  Product Design and Growth Models

 

Proposal One  2022 2024 Proxy Statement | Humana

 

     3913


 

Jorge S. Mesquita

  

 

White Male, Age 6062 Director since 2021

 

LOGO

LOGO

Independent Director

 

Other Public Boards: 1

 

 

 

Jorge S. Mesquita was initially elected to the Board in February 2021. He isMr. Mesquita was formerly Chief Executive Officer of BlueTriton Brands having held this position sincefrom July 2021.2021 until March 2022. In this role Mr. Mesquita leadsled the company’s initiatives to expand market leadership, advance commitment to sustainability and environmental stewardship and to realize the potential of the company’s portfolio of water brands.

 

Prior to joining BlueTriton Brands, Mr. Mesquita was formerly the Executive Vice President, Worldwide Chairman, Consumer of Johnson & Johnson (J&J) from December 2014 until February 2019, where he was responsible for increasing the competitiveness of J&J’s consumer business through a comprehensive transformational strategy. In this role, Mr. Mesquita served on J&J’s Executive Committee and led the Consumer Group Operating Committee. Prior to that, Mr. Mesquita spent 29 years with The Procter & Gamble Company (P&G), where he held various roles leading P&G consumer product business units. During his tenure at P&G, Mr. Mesquita served as Group President – New Business Creation and Innovation from March 2012 until June 2013, Group President – Special Assignment from January 2012 until March 2012, Group President, Global Fabric Care from 2007 to 2011 and President, Global Home Care from 2001 to 2007, also serving as President of Commercial Products and President of P&G Professional from 2006 to 2007. Mr. Mesquita currently serves on the Board of Directors of Mondelez International, Inc.

Committees

 Investment

 Technology

 

The Board believes that Mr. Mesquita’s proven experience in leading business units for significant global, consumer-oriented companies provides a valuable perspective to Humana’s Board and further contribute to its strategic composition. Mr. Mesquita’s forward-thinking, transformational mindset and strong track record of building and marketing global brands, developing consumer insight-driven innovation capabilities, and driving strong, profitable growth will be essential as the Company continues to create seamless consumer experiences and help its members achieve their best health.

 

  Committees

Brad D. Smith

  Skills & Qualifications

White Male, Age 59 Director since 2022

 

 

  Organization & Compensation

  CEO Experience

  Global Experience

  Strategy Development

  Marketing

  Consumer Design/Digital Orientation

  Product Design and Growth Models

James J. O’Brien

Age 67    Director since 2006

LOGOLOGO

Independent Director

 

Other Public Boards: 1

 

 

 

James J. O’Brien

Brad D. Smith was initially elected to the Board in April 2006. Until his retirement on December 31, 2014,September 2022. Mr. O’BrienSmith is the President of Marshall University, having held this position since January 2022. Prior to joining Marshall, Mr. Smith was theExecutive Chairman of the Board of Intuit Inc. from January 2019 until January 2022 and Chief Executive Officer of Ashland Inc.Chairman from January 2016 until January 2019, following 11 years as Intuit’s President and CEO from January 2008 until December 2018. Mr. Smith began his career at Intuit in February 2003, and prior to his time as President and CEO, he served in various leadership positions within the company. Prior to being namedjoining Intuit, Mr. Smith held several executive positions with ADP, where he served from 1996 to this position,2003. Mr. O’Brien was PresidentSmith holds a Bachelor of Business Administration degree from Marshall University and Chief Operating Officer of Ashland Inc., and before that, Senior Vice President and Group Operating Officer. He alsoa Master’s degree in Management from Aquinas College. Mr. Smith currently serves on the boardBoard of directorsDirectors of Albemarle Corporation and Eastman Chemical Company.Amazon.com, Inc.

 

As a highly respected leader in the global business community with an extraordinary track record of success, theCommittees

 Organization &
Compensation

 Technology

The Board believes that Mr. O’Brien’s breadth of managementSmith’s executive leadership experience addsand business acumen in driving transformation through data-driven decision making, rapid experimentation, and customer focus bring valuable expertise and insightperspectives to the Board. Mr. Smith’s deep operating experience and ability to innovate across all organizational layers, while also being mission driven and health equity oriented, will be vital as the Company continues to grow its core Medicare Advantage business, drive operational efficiencies, and mature and further integrate its healthcare services offerings.

14

Humana | 2024 Proxy Statement Proposal One


Corporate Governance

Humana is committed to having sound corporate governance principles and operates within a comprehensive plan of governance for the purpose of defining responsibilities, setting high standards of professional and personal conduct, and ensuring compliance with such responsibilities and standards. Sound corporate governance is essential to running our business effectively and to maintaining our reputation of integrity in the marketplace. In addition, our Board of Directors has adopted Corporate Governance Guidelines, which we refer to as the Guidelines, intended to comply with the requirements of Section 303A.09 of the NYSE Listed Company Manual. The Guidelines may be viewed on our website at www.humana.com. From the www.humana.com website, click on “More Humana,” then click on “For Investors,” then click on “Corporate Governance” subcategory and then click on the link entitled “Corporate Governance Guidelines.”

Role of the Board and Board Leadership

Role of the Board

The business of the Company is managed under the direction of the Board, whose members are elected annually by the Company’s stockholders. The basic responsibility of the Board is to lead the Company by exercising its business judgment to act in what each director reasonably believes to be in the best interests of Humana and its stockholders, while engaging in active and independent oversight of the management of the Company’s business affairs and assets. In order to fulfill its responsibilities to the Company’s stockholders, the Board, both directly and through its committees, regularly engages with management to both evaluate the Company’s current operations and encourage the innovations and strategic imperatives that will drive our success in the future. The Board monitors management performance through reviews of the most critical issues facing the Company, including approval of the Company’s strategy and mission, execution of the Company’s financial and operational goals, oversight of risk management, succession planning, and determination of executive compensation. The Board plans for the future by ensuring management focuses on innovation in our strategy to meet the speed of change in our industry and monitoring the Company’s human capital management functions, working closely with the management team to ensure the Company has the correct levels of talent in place – within each business segment – for continued success in present and future states of the Company.

Board Oversight of Risk

While management is responsible for designing and implementing the Company’s risk management process, controls and oversight, the Board, both as a whole and through its committees, has overall responsibility for oversight of the Company’s risk management. The full Board regularly reviews risks that may be material to the Company, including those detailed in the Audit Committee’s reports and as disclosed in the Company’s quarterly and annual reports filed with the SEC. While the Board has established committees designated for various oversight functions, it is common practice for committees to collaborate on overlapping issues.

Board of Directors

Oversees Management of Major Risks

•  Regulatory & Public Policy

•  Legal

•  Succession Planning

•  Strategic Execution

•  Brand Reputation

•  Investment Objectives

•  Cybersecurity

•  Data Governance

•  Financial

•  Clinical Quality

Committees of the Board of Directors

Audit

•  Financial Statement integrity and reporting

•  Legal, regulatory and compliance

•  Internal controls

•  Cybersecurity
risk oversight

Organization & Compensation

•  Executive and non-executive compensation policies and practices

•  Succession planning

•  Human capital management

Nominating, Governance & Sustainability

Technology

•  Information security, technology, privacy & data protection

•  Company IT strategy and consumer facing technology

Investment

•  Investment objectives and policies

•  Investment
results and performance evaluation

Clinical

Quality

•  Clinical management

•  Healthcare
quality

•  Governance structure and processes

•  Legal and policy matters

•  Stockholder concerns

•  Board refreshment

•  ESG oversight

Management

Business units identify and manage business risks; Central functions design risk framework (setting boundaries and monitoring risk appetite); and Internal Audit provides independent assurance on design and effectiveness of internal controls and governance processes.

Corporate Governance 2024 Proxy Statement | Humana

15


The Company’s Enterprise Risk Management (ERM) governance structure consists of oversight from the Board and the Audit Committee (in collaboration with material risks overseen by other committees), and implementation through the Company’s management team utilizing a three lines of defense model to delegate responsibility for critical risk management processes across the business functions and operational areas, as well as risk management, compliance, and internal audit teams.

Humana’s first line of defense consists of business areas and operational teams across the Company, and is responsible for identifying, assessing, mitigating, monitoring, and managing risk within their respective areas. The Company’s Enterprise Risk Management and Regulatory Compliance departments represent the Company’s second line of defense. These teams are led by Humana’s Chief Legal Officer (CLO), to whom the Chief Risk Officer (CRO) and Chief Compliance Officer (CCO) each report and lead the Enterprise Risk Management and Regulatory Compliance functions, respectively. Humana’s Internal Audit Consulting Group (IACG) represents the third line of defense, which provides independent and objective assurance to senior management and the Board regarding first and second line risk management functions, internal control systems, and governance processes.

The Board and each Committee receive updates no less than quarterly, with the CRO, CCO, and IACG updating the Audit Committee on the assessment, monitoring and mitigation of financial and non-financial risks material to the Company in the short, intermediate, and long-term, the effectiveness of the Company’s control environment in preparing for, stress testing, and managing these risks within the Company’s risk appetite statement, the functioning of the Company’s internal controls and procedures, and the identification and analysis of key emerging risks.

The goal of the Company’s ERM governance is to achieve robust and thoughtful board-level attention to the Company’s risk management process and system, the nature of the material risks faced by the Company, and the adequacy of the Company’s risk management process and system designed to prepare for, test and monitor, respond to and mitigate these risks, each in a manner that closely aligns to the Company’s risk appetite, disclosure controls and procedures.

Board Leadership

Leadership of the Board is essential to facilitate the Board acting effectively as a working group to the benefit of the Company and its performance. As Chairman of the Board, Kurt J. Hilzinger assumes key duties to ensure effectiveness and collaboration in all aspects of the Board’s design, operations, and risk oversight function.

Duties of Our Chairman

 

  CommitteesSkills & Qualifications

  Organization & Compensation (Chair)

  Investment

 

  Financial OversightLOGO    Serves as Chair of regular sessions of the Board and manages the overall Board process, including meeting design topics and agendas.

LOGO    Leads the Board in anticipating and responding to crises, including the ability to call special meetings for the consideration of risk oversight and other matters.

LOGO    Oversees and monitors Board engagement, participation, and continued education to ensure our directors are in-tune with issues of our dynamic industry and the evolving landscape.

LOGO    Partners with and supports the Nominating, Governance & Sustainability Committee with the director selection process, as well as director on-boarding and orientation programs.

LOGO    Models culture, philosophy, inclusivity, and values expected of all directors.

LOGO    Conducts individual meetings with other directors, including the CEO, Experienceand management team to encourage open communication, collaboration, and differences in perspective.

  

 

  Strategy DevelopmentLOGO    Evaluates overall Board effectiveness, with emphasis on identifying areas of enhancement, development and/or furtherance and communicating these observances to the Board for discussion.

  Global Experience

LOGO    Represents the Board on occasions where it is important for the Board to respond on matters independently from the Company’s management team.

LOGO    Provides guidance and direction to the CEO and management team.

LOGO    Engages with stockholders, through verbal or written communications, and presides over the Company’s Annual Meeting of Stockholders. Also recommends to the Board an agenda to be followed at the Annual Meeting.

LOGO    Works with the Organization & Compensation Committee to develop the process for CEO compensation evaluations.

Our Board maintains the flexibility to choose the leadership structure that is in the best interests of our stockholders. When making this determination, the Board considers the recommendation of the Nominating, Governance & Sustainability Committee, the current circumstances and strategic priorities at the Company, and the skills and experiences of the individuals involved, among other considerations.

16 

Humana | 2024 Proxy Statement Corporate Governance


At this time, given the composition of the Company’s Board, the effective interaction between Mr. Hilzinger, as Chairman, and Mr. Broussard, as Chief Executive Officer, Mr. Hilzinger’s status as an independent director and previous service as our Lead Director, and the current challenges faced by the Company, the Board believes that separating the chief executive officer and board chairman positions provides the Company with the right foundation to pursue the Company’s strategic and operational objectives, while maintaining effective independent oversight and objective evaluation of the performance of the Company.

During a period in which the chairman and chief executive officer positions are combined, a Lead Director is appointed from our independent directors. The Lead Director sets agendas for and convenes meetings and executive sessions of the independent directors, approves Board meeting agendas, and otherwise represents the Board on occasions where it is important for the Board to respond independently from the Company’s management team. Our stockholders would be notified of a combination of the chairman and chief executive officer role promptly upon the Board’s decision to do so.

Board Engagement and Undertakings

The Board holds itself to a high standard of engagement, with a hands-on approach that leads to critical insights regarding our customers, operations and business and enhances their level of governance and oversight. An essential component to the Board’s engagement is communicating with the Company’s internal and external stakeholders. To accomplish this, meetings of the Board may be held in key Company markets where, together with management, the Board will personally meet with associates, customers, providers and other stakeholders to gain direct feedback into the Company’s operations, experiences and overall effectiveness. The Board also holds virtual meetings to both increase the efficiency of the Board’s time and expand its reach of engagement with Company personnel and other stakeholders.

Certain other engagement practices of our Board are described below.

  Risk Assessment

 

Follows an annual topical calendar used to balance strategic, operational, compliance, and cultural matters, among others, and receives detailed reports on those topics, in addition to ad hoc subjects, throughout the year.

 

Utilizes clear and proactive Board meeting agendas to achieve high productivity at each meeting.

Holds executive sessions during every meeting, with the CEO present and then with only the independent directors. Relevant feedback is then reported to the CEO and the management team, creating a feedback loop from the Board to the management team.

Maintains regular communication with the CEO and management team, apart from formal Board meetings, to ensure consistent and continuous progress toward established goals.

Employs Board technology tools to review Board materials and to remain informed of ongoing Company endeavors, to efficiently communicate with the management team and to take formal action when necessary.

Performs in-depth organizational structure reviews, through the Organization & Compensation Committee, of line and functional teams within the Company to assess leadership bench strength, culture, succession planning, diversity and related matters, and engages regularly with rising leaders within the Company. The Organization & Compensation Committee also regularly reviews associate engagement scores, and for 2023, 85% of associates were highly engaged, representing the 79.4th percentile. Refer to the section titled “Our Culture, Engagement and Approach to Work” in this proxy statement for a discussion of these results.

Receives continued education from external consultants on a wide range of industry topics to keep them apprised of the latest trends and anticipated future trajectories. In addition to our director’s individual pursuits, Board education opportunities during 2023, included, (i) a formal education session with external consultants; (ii) guest speaker attendance during select meetings; and (iii) briefings on regulatory developments.

Participates in the Company’s robust stockholder engagement program.

2023 Board and Committee

Meetings

32  

Videoconference / Teleconference 

17  

In-person   

1  

Annual Stockholder  

2023 Director Attendance

100%

of our director nominees met NYSE attendance
requirements

Corporate Governance 2024 Proxy Statement | Humana

17


Board Evaluation Practices

The Board is committed to a rigorous self-evaluation process. Through evaluation, directors annually review the performance of the Board and each committee, as well as their own individual contributions, including areas where the Board feels it functions effectively, and most importantly, areas where the Board can improve. The Nominating, Governance & Sustainability Committee, with participation from our Chairman and Chief Executive Officer, initiates the annual Board evaluation process. We believe that having a review process for each group helps to (i) ensure an adequate representation of requisite skills; (ii) encourage high levels of engagement from directors; and (iii) strengthen the overall effectiveness of our Board. Results of the evaluations are shared with the Chairman of the Board and the Chairman of the Nominating, Governance & Sustainability Committee and then later discussed with the entire Board in an aggregated manner, with agreed upon actions and improvements then implemented and monitored for effectiveness.

Board Evaluation

40

The Board evaluation typically consists of a written questionnaire containing qualitative scaled and open-ended questions related to the effectiveness of the Board during the prior year. The questionnaire hones in on specific areas of responsibility and critical attributes of the Board in order to solicit candid feedback from each director. The questionnaire also seeks practical input as to what the Board is doing well, areas in which the Board could improve and any undertakings that the Board should commence or terminate. Every third year, this written evaluation process is supplemented by oral interviews and an analysis of Board and committee effectiveness conducted by an independent consultant.

Director Self-Evaluation

The director self-evaluation requires each director to honestly reflect upon and carefully consider his or her performance based on key characteristics that are expected of all board members. The self-evaluation also allows directors to provide additional or updated information regarding their skills and qualifications which in turn helps the Nominating, Governance & Sustainability Committee make future assessments and determinations regarding Board composition. The Company encourages directors to participate in continuing education programs focused on the Company’s business and industry, their committee roles and responsibilities, as well as legal and ethical matters. Annually, the Board will meet for purpose of furthering their education through external guest speakers to gain insights into key issues facing the industry and the Company, to supplement management’s views and perspectives.

Committee Evaluation

Each of our Board committees engages in an annual performance evaluation and a general charter adequacy review. Each committee is responsible for determining the manner of evaluation and for carrying out the evaluation. Generally, the committee evaluations coincide with the annual Board evaluation and similarly, consist of a written questionnaire containing qualitative scaled and open-ended questions related to the effectiveness of the committee during the prior year. Further, the Board evaluation questionnaire includes a section specifically concerning Board committee structure which is an opportunity for board members to provide feedback regardless of their individual committee membership.

Director Independence

To qualify as independent under the Guidelines and the rules of the NYSE, the Board of Directors must affirmatively determine that a director has no material relationship with the Company, other than as a director (i.e., a relationship which could interfere with the director’s exercise of independent judgment). In addition, any relationships between the Company or any of its affiliates and any director or entity related to a director must be below the thresholds for independence prescribed by the NYSE.

Pursuant to the Guidelines, the Board undertakes an annual review of director independence. During this review, the Board considers transactions and relationships between each director or any member of his or her immediate family and the Company and its subsidiaries and affiliates, including transactions or relationships that are reported under “Certain Transactions with Management and Others” in this proxy statement. As provided in the Guidelines, the purpose of this review is to determine whether any such transactions or relationships are inconsistent with a determination that a director is independent.

In the course of this review for the current year, the Board specifically analyzed and discussed several matters:

(1)

a relationship between the Company and Oracle Health, for which David T. Feinberg, M.D., one of our current directors, serves as an executive officer;

(2)

a relationship between the Company and Howard University and the Howard University Healthcare system, or Howard, for which Wayne A. I. Frederick, M.D., one of our current directors, served as an executive officer during 2023;

18

Humana | 2024 Proxy Statement Corporate Governance


(3)

a relationship between the Company and Chrysalis Ventures, LLC, or Chrysalis, for which David A. Jones, Jr., one of our former directors, serves as Chairman and Managing Partner and in which Mr. Jones has a financial interest;

(4)

a relationship between the Company and Warren Barr Lieberman, at which an immediate family member of William J. McDonald, one of our directors who is not standing for re-election at our Annual Meeting, is an employee; and

(5)

financing arrangements between the Company and companies that are affiliated with certain of our directors.

Oracle Health. Oracle Health has a license subscription contract with our subsidiary, Humana Digital Health and Analytics Platform Services, Inc., or HDH&A. In 2023, Oracle Health paid HDH&A approximately $5.7 million in associated licensing, professional service and maintenance fees, which is comparable to other non-affiliated customers for the provision of similar services. The relationship described herein is not material to the Company and does not represent a direct or indirect material interest for Dr. Feinberg.

Howard. The relationship between the Company and Howard includes arrangements between the Howard University healthcare system in which the Company paid approximately $100,000 in medical claims during 2023. The relationship described herein did not represent a direct or indirect material interest for Dr. Frederick.

Chrysalis. In 2023, we contracted for services to be provided by certain companies in Chrysalis’ investment portfolio. In each case, the amounts paid under these arrangements were comparable to those for other non-affiliated vendors, were not material to the Company, and did not represent a direct or indirect material interest for Mr. Jones.

Warren Barr Lieberman. The relationship between the Company and Warren Barr Lieberman includes a provider arrangement in which the Company paid approximately $191,250 in medical claims during 2023. The relationship described herein did not represent a direct or indirect material interest for Mr. McDonald.

Financing Arrangements. Certain of our non-employee directors are partners, shareholders and/or officers of companies that have commercial paper programs or other financing arrangements in which we participate in the ordinary course of business. Payments to or from such companies constituted less than the greater of $200,000 or 1% of each of Humana’s and the recipient’s annual revenue, respectively, in each of the past three years.

At the conclusion of its review for the current year, the Board affirmatively determined that in each case the relationship between the Company or its affiliate and each director-related entity was not material and would not interfere with the director’s exercise of independent judgment. In addition, each of those relationships was below the thresholds for independence prescribed by the NYSE. Directors recused themselves from the independence assessment as the matter was relative to himself or herself. Consistent with these considerations and based on its review of director independence in light of the standards contained in the Guidelines, the Board determined that each member of the Board of Directors (except Mr. Broussard, as a current employee of the Company) is independent.

Corporate Governance 2024 Proxy Statement | Humana

19


Committee Membership and Meetings

The Board of Directors has the following standing committees: Audit; Organization & Compensation; Nominating, Governance & Sustainability; Technology; Investment and Clinical Quality. Only directors meeting the applicable SEC and NYSE director independence standards and Internal Revenue Code “outside director” criteria may serve on the Audit Committee, the Organization & Compensation Committee, and the Nominating, Governance & Sustainability Committee. Each standing Board committee operates pursuant to a charter, which may be viewed on our website at www.humana.com. From the www.humana.com website, click on “More Humana,” then click on “For Investors,” then click on “Corporate Governance,” then click on the “Committee Charters” subcategory. The number of Board committee meetings (virtual and in-person) held in 2023 and membership as of March 1, 2024, were as follows:

Director

 

 

Audit  

 

 

 

Organization  

&  

Compensation  

 

 

 

Nominating,  

Governance &  

Sustainability  

 

 

Technology  

 

 

Investment  

 

 

Clinical  
Quality  

 

Kurt J. Hilzinger

     

 

 

   

 

 

  

Bruce D. Broussard

   

 

 

       

 

 

Raquel C. Bono, M.D.

 

 

LOGO   

 

         

 

LOGO   

 

Frank A. D’Amelio

 

 

LOGO   

 

   

 

LOGO   

 

      

David T. Feinberg, M.D.

     

 

LOGO   

 

     

 

LOGO   

 

Wayne A. I. Frederick, M.D.

   

 

LOGO   

 

       

 

LOGO   

 

      

John W. Garratt

 

 

LOGO   

 

       

 

LOGO   

 

  

Karen W. Katz

   

 

LOGO   

 

 

 

LOGO   

 

      

Marcy S. Klevorn

 

 

LOGO   

 

     

 

LOGO   

 

    

William J. McDonald

 

 

LOGO   

 

       

 

LOGO   

 

  

Jorge S. Mesquita

       

 

LOGO   

 

 

 

LOGO   

 

  

Brad D. Smith

   

 

LOGO   

 

   

 

LOGO   

 

    

 

Number of Meetings in 2023

 

 

 9  8   3   5   4   4  

LOGO   = Chair   LOGO   = Member

Audit Committee

Committee Responsibilities

Pursuant to its charter, the Audit Committee:

assists the Board of Directors with the oversight of the integrity of our financial statements and disclosures and internal controls, our compliance with legal and regulatory requirements, the independent registered public accounting firm’s qualifications and independence and the performance of our internal audit function and the independent registered public accounting firm;

bears responsibility for the appointment, compensation, retention and oversight of the work of the independent registered public accounting firm engaged to prepare the audit report or perform other audit, review or attest services;

reviews with the independent registered public accounting firm, our internal audit department, and our financial and accounting personnel, the effectiveness of our accounting and financial controls and, where appropriate, makes recommendations for the improvement of these internal control procedures;

reviews the scope, funding and results of our internal audit function, including the independence and authority of our reporting obligations, the proposed audit plans for the year, and the coordination of these plans with the independent registered public accounting firm;

reviews the scope, funding and results of our Enterprise Risk Management program and compliance program, including receiving, at least quarterly, an update from our Chief Risk Office and internal compliance department regarding any significant matters regarding our risk management and compliance with regulatory requirements and contracts with government entities, respectively;

collaborates with the Technology Committee to regularly receive updates on risks, and risk mitigation measures, related to Company’s information technology, internal controls, information security, cyber security, business continuity and disaster recovery programs;

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Humana | 2024 Proxy Statement Corporate Governance


reviews the financial statements and other information contained in our Annual Report and other reports to stockholders with management and the independent registered public accounting firm to determine that the independent registered public accounting firm is satisfied with the disclosure and content of the financial statements to be presented to the stockholders and reviews any changes in accounting principles;

confers independently with our internal auditors, Chief Risk Officer, internal compliance department, key members of management, and the independent registered public accounting firm;

determines and approves the appropriateness of the fees for audit and permissible non-audit services performed by the independent registered public accounting firm;

discusses with management our compliance with applicable legal requirements and with our internal policies regarding related party transactions and conflicts of interest;

discusses our policies with respect to risk assessment and risk management;

maintains free and open means of communication between the members of our Board of Directors, the independent registered public accounting firm, our internal audit department, our Chief Risk Officer, our internal compliance department, and our financial management; and

annually evaluates its performance.

Corporate Governance Determinations

The Board of Directors has determined that each of the members of the Audit Committee at February 15, 2024 is independent according to SEC and NYSE requirements, and each is financially literate, as defined in the NYSE listing standards. The Board of Directors has determined further that Messrs. D’Amelio and Garratt and Dr. Bono each meet the definition of “audit committee financial expert.” PricewaterhouseCoopers LLP, our independent registered public accounting firm, reports directly to the Audit Committee. No member of the Board’s Audit Committee serves on the audit committees of more than three publicly traded companies. The Report of the Audit Committee for the year ended December 31, 2023, is set forth in this proxy statement under the caption “Audit Committee Report.”

Organization & Compensation Committee

Committee Responsibilities

Pursuant to its charter, the Organization & Compensation Committee:

reviews and approves our goals and objectives relevant to the compensation of our CEO, evaluates the CEO’s performance in light of those goals and objectives, and, either as a Committee or together with the other independent directors, determines and approves the CEO’s compensation level based on this evaluation;

reviews and approves all elements of compensation paid to our current or prospective executive officers, including without limitation, base compensation, incentive-compensation plans and equity-based plans, employment, change in control or severance programs and agreements, and any special compensation or benefits, including supplemental retirement benefits and any perquisites;

approves equity-based grants to our executive officers and other associates;

reviews and discusses with management the Company’s compensation plans and policies for all employees (including the Named Executive Officers) with respect to risk management and risk-inducing incentives;

ensures preparation of the Compensation Discussion and Analysis and the Compensation Committee Report as required by SEC regulations;

monitors compliance of executive officers and non-employee directors with relevant stock ownership guidelines;

reviews with management periodically, as it deems appropriate, management succession and inclusion and diversity practices;

administers our Executive Management Incentive Compensation Plan and other substantially similar or successor incentive compensation plans; and

annually evaluates its performance.

Scope of Authority, Processes and Procedures

The Organization & Compensation Committee acts on behalf of the Board of Directors to establish the compensation of our executive officers and provides oversight of our compensation philosophy, as described in this proxy statement under the caption “Compensation Discussion and Analysis.” The role of the executive officers and the outside compensation consultant in establishing executive compensation is discussed in this proxy statement under the caption “Compensation Discussion and Analysis.” Other than routine administrative matters and the ability of our CEO to approve grants of equity awards subject to certain individual and annual thresholds, no executive compensation decisions are delegated to management.

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Compensation Committee Interlocks and Insider Participation

No member of the Organization & Compensation Committee: (i) is or has ever been an officer or employee of the Company; or (ii) is or was, during the last fiscal year, a participant in a “related person” transaction requiring disclosure under Item 404 of the SEC’s regulations (see discussion in this proxy statement under the caption “Certain Transactions with Management and Others”); or (iii) is an executive officer of another entity at which one of our executive officers serves either as a director or on its compensation committee.

Corporate Governance Determinations

During 2023, James J. O’Brien (Chair until April 18, 2023), Wayne A. I. Frederick, M.D. (Chair effective April 18, 2023), David A. Jones, Jr. (until April 18, 2023), Karen W. Katz, Jorge S. Mesquita (until April 18, 2023), and Brad D. Smith served as members of our Organization & Compensation Committee. Considering (i) the source of each director’s compensation, including any consulting, advisory or other compensatory fees paid by the Company; and (ii) whether each director has an affiliate relationship with the Company, a subsidiary of the Company or an affiliate of a subsidiary of the Company, the Board has determined that each member of the Organization & Compensation Committee at February 15, 2024, is independent, as defined by the SEC and the NYSE, and is considered to be an “outside director” under Section 162(m) of the Internal Revenue Code.

Compensation Risk Determination

In early 2024, the Organization & Compensation Committee reviewed management’s assessment of the risks associated with the Company’s compensation practices and policies for employees, including a consideration of the counterbalance of risk-taking incentives and risk-mitigating factors in Company practices and policies. Following a review of this assessment, the Organization & Compensation Committee determined that the risks arising from the Company’s compensation practices and policies are not reasonably likely to have a material adverse effect on the Company.

Nominating, Governance & Sustainability Committee

Committee Responsibilities

Pursuant to its charter, the Nominating, Governance & Sustainability Committee:

recommends to the full Board criteria for the selection and qualification of the members of the Board;

evaluates and recommends for nomination by the Board candidates to be proposed for election by the stockholders at each annual meeting;

seeks out and assists in the recruitment of highly qualified candidates to serve on the Board;

recommends for Board approval candidates to fill vacancies on the Board which occur between annual meetings;

develops, periodically reviews and recommends to the Board revisions to the Guidelines;

studies and reviews with management the overall effectiveness of the organization of the Board and the conduct of its business, and makes appropriate recommendations to the Board;

reviews the overall relationship of the Board and management;

reviews issues and developments pertaining to corporate governance;

reviews our public policy and political spending practices through regular reviews of our policy on political expenditures, expenditures and payments made with corporate funds, and overall political activity, including review of our Political Contributions and Related Activity Report;

reviews the Company’s programs and policies relating to significant ESG and sustainability matters, and periodically receive updates from the Company’s management regarding significant ESG and sustainability undertakings; and

annually evaluates its performance.

Technology Committee

Committee Responsibilities

Pursuant to its charter, the Technology Committee:

receives, reviews and provides feedback on the Company’s annual IT strategy report which shall include a summary view of the strategic technology investments, execution roadmap and IT capital plan;

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receives, reviews and provides feedback on the Company’s Enabling Technologies Strategy which contemplates investments in technology capabilities which may be considered foundational investments that are non-specific to one or more business strategies, but create capabilities and conditions to enable business strategies;

receives, reviews and provides feedback on certain High Impact Use Cases (i.e., purpose-driven applications of technology) which management considers highly representative of transformational business capabilities or consumer and provider experiences. Such use cases inform required investments in business and technology capabilities;

receives, reviews and provides feedback on the Company’s annual scan, assessment and report on emerging technologies and innovations deemed likely to be relevant to the Company’s future competitiveness and which may represent opportunities or threats to the Company;

receives, reviews and provides feedback on the Company’s Competitive Analysis of the technology capabilities and investments in industry-relevant capabilities being made by Healthcare IT companies, market moving “technology titans,” as well as traditional and non-traditional competitors;

receives, reviews and provides feedback on the Company’s IT Operating Strategy, including governance models, operating model and talent assessment; and

in conjunction with the Audit Committee, receives, reviews and provides feedback on the Company’s ongoing assessment and plan to address IT risks including cybersecurity, business continuity and disaster recovery risks.

Senior leadership also briefs the Technology Committee and board members on matters relating to the Company’s strategic technology capabilities, including information security capabilities. The Technology Committee may also assist the Audit Committee in its oversight of our information technology internal controls, cybersecurity, business continuity and disaster recovery programs. Senior leadership provides briefings to the Audit Committee and Technology Committee on information technology controls and risk as least once per year, and separately updates the full Board of Directors on cybersecurity matters at least once per year. Briefings are also provided as needed in response to industry or company specific developments or material events.

Investment Committee

Committee Responsibilities

Pursuant to its charter, the Investment Committee establishes investment objectives and policies for our various investment portfolios and investment options available under various employee benefit plans, reviews investment results, and annually evaluates its performance.

Clinical Quality Committee

Committee Responsibilities

Pursuant to its charter, the Clinical Quality Committee:

in conjunction with the Company’s management, periodically evaluates new developments and current trends with respect to patient experience and quality care that may affect companies in the healthcare industry;

receives, reviews and provides feedback on the Company’s efforts to integrate clinical experience and care models that: (a) positively impact member/patient health outcomes; (b) reduce the cost of care and improve health care affordability; (c) improve access to cost-effective, high-quality care; (d) address social determinants of health and reduce health disparities; and (e) improve member/patient experience and satisfaction;

receives, reviews and provides feedback on the Company’s clinical practices, policies and innovations, including value-based care strategies, clinical and quality trends, and strategic priorities;

receives, reviews and provides feedback on the quality of the Company’s healthcare services operations, including the quality of the Company’s pharmacy solutions, medical clinic operations and in-home care solutions; member/patient experience; and provider-led models for the delivery of care; and

annually evaluates its performance.

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Corporate Governance Policies

Majority Vote Policy for Director Elections

Under our Bylaws, a director nominee will be elected if the number of votes cast for the nominee exceeds the number of votes cast against the nominee. In contested elections, those in which a stockholder has nominated a person for election to the Board, the voting standard is a plurality of votes cast. The Board has also adopted a policy to require the Board to nominate for election only nominees who agree that, if they are elected to the Board, they will tender an irrevocable resignation conditioned on, first, the failure to achieve the required vote for re-election at any future meeting at which they face re-election, and second, the Board’s acceptance of their resignation following that election. In addition, the Board may fill director vacancies and new directorships only with candidates who agree to tender, promptly following their appointment to the Board, the same form of resignation tendered by other directors, as described above. The Nominating, Governance & Sustainability Committee will submit a recommendation for prompt consideration by the Board whether to accept the resignation. Any director whose resignation is under consideration will abstain from participating in any decision regarding that resignation. The Bylaws also require stockholder nominees for director election to notify the Company whether or not such nominees intend to tender the same type of resignation required of the Board’s director nominees.

Change in Director’s Primary Position

The Board has adopted a policy requiring that a director whose primary position or affiliation changes must promptly notify the Board and the Nominating, Governance & Sustainability Committee of the change so that a determination may be made as to the value of his or her continued service on the Board.

Additional Public Company Board Service

As part of its commitment to ensuring that each of our directors have the capacity to devote sufficient time and effort to his or her duties as a director, the Board has adopted a policy under which (a) a director (other than a director who is the chief executive officer of a public company) may not be a director on more than four (4) public company boards (including the Company), and (b) a Director who is the chief executive officer of a public company may not be a member of more than two (2) public company boards (including the Company). All of our directors are currently in compliance with the policy.

Director Stock Ownership Policy

Our Board believes that directors should be stockholders and have a significant personal financial stake in the Company. Consequently, the Board has adopted the following stock ownership guidelines for non-employee directors:

Each non-employee director must maintain a minimum equity ownership level of five times the annual cash retainer.

Shares deferred at the election of the director are considered owned for purposes of the calculation of the ownership requirement.

Any Shares owned by a non-employee director (or Shares received upon the exercise of options or vesting of restricted stock or restricted stock units, less an amount to cover the exercise price and/or current tax liabilities) must be held by the director until the minimum equity ownership level is reached and thereafter maintained.

Once the minimum equity ownership level has been achieved, any Shares received upon the vesting of restricted stock or restricted stock units, less an amount to cover current tax liabilities, must be held by the director until one year following the vesting date.

Compliance with these guidelines is monitored by the Organization & Compensation Committee.

Director Attendance

The Board has developed a number of specific expectations of directors to define their responsibilities and to promote the efficient conduct of the Board’s business. With respect to the level of commitment expected of directors and related attendance protocols, as part of the Guidelines, the Board formally adopted a policy that all directors should make every effort to attend all meetings of the Board and the Committees of which they are members, and the Company’s Annual Meeting of Stockholders. Attendance by telephone or video conference may be used to facilitate a Director’s attendance.

During 2023, apart from Committee meetings, the Board of Directors met 16 times. All director nominees attended at least 75% of the scheduled Board of Directors’ meetings and meetings held by Committees of which they were members. Further, all director nominees serving as directors at that time attended the Annual Meeting of Stockholders held on April 20, 2023.

Executive Sessions of Non-Management Directors

In 2023, our non-management directors held regularly scheduled, formal executive meetings, separate from management and were led by our Chairman. Additional executive sessions of the Board are held as necessary or appropriate or upon the request of the Chairman, the

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Humana | 2024 Proxy Statement Corporate Governance


Nominating, Governance & Sustainability Committee or any two other non-management directors. In addition, our non-management directors who qualify as independent within the meaning of our director independence guidelines meet in executive session at least once annually, and, in fact, met in 2023 in connection with each regularly scheduled Board of Directors meeting.

Code of Ethics and Code of Business Conduct

The Company has adopted the “Code of Conduct for the Chief Executive Officer and Senior Financial Officers,” which we refer to as the Executive Code of Ethics, violations of which are reported to the Audit Committee. In addition, we operate under the omnibus Humana Inc. Ethics Every Day, which we refer to as the Code of Ethics, which applies to all associates (including executive officers) and directors. The Humana Ethics Office is responsible for the design and enforcement of our ethics policies, the goal of which is to create a workplace climate in which ethics is so integral to day-to-day operations that ethical behavior is self-enforcing. All employees are required annually to review and affirm in writing their acceptance of the Code of Ethics. The Code of Ethics and the Executive Code of Ethics may be viewed on our website at www.humana.com. Any waiver for directors or executive officers from the provisions of the Code of Ethics or the Executive Code of Ethics must be made by the Board of Directors and will be disclosed within four days of the waiver on our website at www.humana.com. To see either the Code of Ethics or the Executive Code of Ethics or any waivers to either policy, go to www.humana.com, then click on “More Humana,” then click on “For Investors,” then click on “Corporate Governance,” and then click on the relevant link.

Policy Regarding Employee, Officer and Director Hedging

The Company has a policy prohibiting all associates (including executive officers and independent directors) from hedging or pledging transactions using Company stock, including: (1) engaging in short sales of Company securities; (2) engaging in transactions in puts, calls or other derivative securities designed to hedge or offset any decrease in the market value of the Company’s equity securities, on an exchange or in any other organized market; or (3) engaging in certain monetization transactions, including holding Company securities in margin accounts or pledging Company securities as collateral.

Advocacy and Public Policy

With a focus on improving clinical outcomes and advancing affordability and access, our Company’s approach to advocacy and public policy is built around people (that is, the members, patients, providers, and communities we serve). To that end, our day to day efforts are centered around supporting policies that strengthen Medicare Advantage, accelerate value-based care in the home, expand opportunities to serve patients through primary and home-based care, integrate clinical solutions, create affordability for prescription drugs, and address barriers to care by addressing the root causes of poor health, as well as leveraging our capabilities to remove barriers to access and partnering with clinicians to improve quality. This focus raises the bar for the care we provide to help move toward a future in which everyone has a fair and just opportunity to be as healthy as possible.

The Company has also established and sponsors a Political Action Committee (PAC), for which Company associates may voluntarily contribute. The PAC is registered with the Federal Election Commission (FEC) and certain states nationwide as required by applicable law. As a matter of policy, all Company political activities must promote the interests of the Company and must be made without regard for the private political preferences of Company officers or executives. Distributions from the PAC are made to federal and state office candidates (and related election committees) or to other PACs on a non-partisan basis when, like the Company, such persons are solution-oriented and believe in building a high-quality, accessible and affordable health care system. The PAC is also committed to supporting diverse candidates at the state and federal level. While the PAC has its own separate board of directors to oversee its operations, the Company’s Board—through its Nominating, Governance & Sustainability Committee—has responsibility for (i) reviewing the political contributions and political activities of the Company and the PAC and (ii) overseeing compliance with the overall policy, process and contribution criteria with respect to such contributions and activities. The Board reviews occur semi-annually, along with semi-annual publication of a Contributions and Related Activity Report (PAC Report). To learn more about our public policy and to review the most recent PAC Report, visit our website at www.humana.com, then click on “About Humana,” then click on either “Public Policy” or “Political Contributions.”

Communication with Directors and Management

Stockholders and other interested parties may communicate directly with our Chairman, non-management directors as a group, or any other individual director by using the “Contact the Board of Directors” form published on our website. Specifically, interested parties may visit our website at www.humana.com then click on “About Humana,” then click on “Board of Directors,” where instructions for contacting these persons are available. All directors have access to correspondence received through this mechanism. Additionally, stakeholders can use this mechanism to direct questions or concerns to members of the Company’s management on topics such as the Company’s business operations, business conduct, business relationships and conduct of Company personnel.

We use the staff of our Corporate Secretary to review correspondence received in this manner and will filter advertisements, solicitations, spam, and other such items. Concerns received that are related to accounting, internal controls or auditing matters are required to be

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25


brought immediately to the attention of our Chief Legal Officer and the Board and handled in accordance with procedures established by the Audit Committee with respect to such matters. Other concerns may be escalated to our Executive Resolution team for review and that team will work with members of management to address the issue with the stakeholder.

Member complaints, appeals and/or grievances related to Medicare Advantage, Medicaid or prescription drug coverage provided by our Company should not be directed through the above mechanism. Instead, members are encouraged to call the Customer Care number located on their Humana ID card or submit an online request for appeal, grievance or exception. Instructions for online submissions are located on our website at www.humana.com then click on “Complaints & Appeals.”

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Humana’s Impact

Board Oversight of Environmental, Social and Governance Matters

The Nominating, Governance & Sustainability Committee has responsibility for Board-level oversight of the Company’s environmental, social and governance (ESG) strategy, practices and reporting. The Nominating, Governance & Sustainability Committee receives formal ESG reports from management at least twice annually regarding the Company’s ESG initiatives, metrics and progress on established goals, as well as ad hoc ESG communications as necessary. The full Board is invited to attend and participate during these meetings and receives access to all ESG reporting. In addition, we have an internal ESG Steering Committee, overseen by our Chief Administrative Officer and Chief Legal Officer, to guide the integration of our ESG efforts with our long-term business strategy. This ESG governance structure complements the long-standing responsibility of our Board and each of our Board committees in overseeing various aspects of the Company’s ESG-related risks and practices, as illustrated below:

BOARDOF DIRECTORS

Nominating, Governance & Sustainability Committee

Audit Committee

Organization & Compensation Committee

Technology Committee

Investment Committee

Clinical Quality

Committee

  Risk Management

  Cybersecurity

  Human Capital Management

  Inclusion & Diversity Practices

  Company Compensation Plans & Policies

  Privacy & Data Protection

  Information Security

  Investment Portfolio

  Investment Guidelines

  Member and Patient Experience

  Clinical Management

  Healthcare Quality

Chief Administrative Officer and Chief Legal Officer

(In collaboration with members of the executive management team)

ESG Steering Committee

OversightManagementImplementation

Strategic Focus on ESG

We realize that the future of our business is linked with the well-being of our associates, members and patients, the communities we serve, the healthcare system, and the environment. It’s with our stakeholders in mind that we’ve established five key measure categories (the “Categories”) of our ESG program that align to our strategic business goals, supporting our commitments to sustainable business and improving health outcomes. These Categories are the driving force behind our impact platform and guide our ESG program.

LOGO

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We’ve developed quantitative and/or qualitative factors within each Category to track, monitor, measure and report our performance. Transparent disclosures are a top priority, as such, we’ve mapped our ESG disclosures to frameworks established by the Sustainability Accounting Standards Board (SASB) Managed Care Standard, the Task Force on Climate-Related Financial Disclosures (TCFD), and the Global Reporting Initiative (GRI).

Our Impact Platform

We’ve set our intentions to have a positive well-being impact among all of our stakeholder groups and have developed a platform where we believe we can make the most difference. Our impact platform sets the direction for how we will advance health equity, address needs in our communities and drive sustainable change with shared value. The Categories may connect to one or more areas within the impact platform, reinforcing the interconnectedness of our holistic approach to ESG. We’ve highlighted below key elements of our ESG strategy along with noteworthy factors within certain Categories.

LOGO

LOGO

LOGO

LOGO

For each person, we make it simpler for people to reach their best health.

For each community, we work to advance health equity and population health.For the healthcare system, we help build more equitable business, governance and healthcare practices.

For the environment, we invest in the health and sustainability of our environment.

We are all on a unique journey to our own best health, so through empathy and a personalized approach, we not only address medical needs, but meet people where they are by helping our customers, associates – everyone – address human needs, too.Where people live, work and play are inextricable from their health outcomes, so we’re passionate about taking on the social determinants of health that impact their communities on a local level.The future of health depends on the health of the collective system, so alongside our partners, we’re striving to create a more equitable health ecosystem that incorporates sustainable business practices, to better serve all of us, and the next generation.The health of individuals is deeply tied to the health of their environments, so we do our part to invest in, protect and care for the places and planet all people depend on.

For Each Person

LOGO

Human Capital Management

For each person starts with each of our associates, approximately 67,600 as of December 31, 2023, and our approach to human capital management.Not only are our associates intrinsically connected

under each dimension of ESG, they’re also essential to our Company’s success in delivering on our core strategy, creating positive healthcare experiences, demonstrating our health first purpose and providing human care for our members. We are committed to recruiting, developing, and retaining strong, diverse teams, and activelypromoting a culture of inclusion and diversity within our workforce.

These efforts are overseen by our Board of Directors through the Organization & Compensation Committee, whose functions include oversight of the Company’s human capital management and inclusion and diversity policies and practices, which are implemented under the direction of our Chief Administrative Officer.

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Our Culture, Engagement and Approach to Work

We believe that our members’ experience is linked to our associates’ experience—engaged, productive associates are the key to building a healthy company and caring environment where our associates go above and beyond for our members and patients, driving innovation, and offering fulfilling experiences that incentivizes them to stay with us over the long-term. We provide opportunities for our associates to add to their personal well-being experiences that go beyond health to enhance their individual need for purpose, belonging and security. On average, our associates spend 7 years at our Company—a tenure testament to our commitment to their growth, well-being, and our culture. A culture that is further reinforced by our voluntary turnover rate (VTR), which we believe is an important indicator of workforce satisfaction as our associates continue to choose us over other opportunities. During 2023, our VTR was 13.4%, representing a decrease from 17% in 2022. We measure VTR using data generated via Workday and include any full or part-time, regular associates who left voluntarily during each year; contractors and variable staffing pool (VSP) are excluded, as are associates resulting from 2023 acquisitions not yet transitioned to Humana’s Workday system at yearend.

82%

Of associates would recommend Humana
as a great place to work.

89%

Of associates believe their leader really
cares about their well-being.

84%

Of associates believe they have the
flexibility they need to manage their work
and personal needs.

We regularly measure our success and seek opportunities to advance engagement, through an Associate Experience Survey (AES) and continuous listening campaigns. Continuous listening involves our proactive solicitation, analysis and response to associate feedback throughout the year using pulse surveys. By regularly surveying samples of our workforce, we’re able to continuously assess our effectiveness and act when needed, which in turn helps to strengthen our culture and support associate engagement. We aim to conduct our confidential, third-party administered AES on an annual basis and encourage all of our associates to participate. The AES is an in-depth survey covering eighteen dimensions that align to the Company’s strategy and associate engagement. We aggregate survey results, provide them to our entire associate population and encourage leaders to use the information to create open, honest action plans with their teams to build upon our collective engagement.

We conducted the AES in 2023 and saw high participation, with 74% of associates completing the survey. While we would have liked to see our overall engagement score increase, we landed at 85% favorable this year, down from 91% favorable in 2021, when we last conducted the survey. In assessing these results it’s important to recognize that since 2021 we experienced dramatic scale and pace of change within our organization—notably the addition of CenterWell Home Health associates and others who joined our workforce following acquisitions. Given these events, along with the significant amount of transformation our Company experienced leading up to our survey, it is understandable that these changes measurably impacted our associate experience. It is also consistent with the feedback we’ve received from associates. Despite these results, there were some encouraging insights that make us optimistic about the future as we believe there’s opportunity for us to make adjustments that lead to better outcomes in the next survey.

We believe strong Company culture starts with leadership at the top. Our CEO inspires Company culture by sending a weekly Company-wide email where he engages with associates on a variety of topics including business matters, current events, health and well-being, family and personal interests. A survey link is included within these communications encouraging associates to speak up and share their own experiences directly with our CEO, with assurance that their opinions will be held confidential and treated with respect.

Our culture is further strengthened by optimizing the well-being and effectiveness of our workforce. Through alternative work styles—home, hybrid home, office, hybrid office, and field—we help associates work more productively, communicate more effectively, and collaborate more freely. We encourage collaboration between leaders and their associates to identify and leverage the appropriate work style that both supports the achievement of business goals and personal work preferences. Alternate work styles enable associates to work from a job-appropriate location of their choice for all or some portion of their work schedule—helping them to manage life’s competing demands. We view these workstyle offerings as a valuable benefit to our associates as well as a recruitment lever to attract top talent. It’s also clear that when managed effectively, alternate work styles can enhance a company’s employment brand, foster the development and effective delivery of innovative and diverse business solutions, right-size a company’s energy-consumption footprint, and increase associate engagement and well-being.

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Diversity, Equity and Inclusion

The Company’s Office of Diversity, Equity & Inclusion (our “DEI Office”) efforts are led by our Chief Diversity, Equity & Inclusion Officer, who reports directly to the Chief Administrative Officer. The DEI Office connects to business groups across the enterprise to cultivate a diverse and inclusive culture that is representative of the communities we serve. By prioritizing DEI across our business, we enable associates to bring their whole selves to work, while also driving the innovation and insights needed to better serve our diverse members and communities. Together with key partners like our Chief Health Equity Officer, our Executive Diversity, Equity & Inclusion Council (the “Council”), our Network Resource Groups (NRGs), and Culture & Engagement professionals we strive to expand our culture of inclusion to build deep relationships and create simple, personalized experiences for all of our stakeholders.

Our Council exists to help integrate inclusion, diversity and equity into the fabric of the organization from the top down—connecting activities to a broader business-driven, results oriented strategy, and leverages leadership to advance DEI into the fabric of Humana’s culture. The Council reflects the diversity of our associates and communities we serve. Chaired by Humana’s

89%

Of associates believe that people in
their department/team
demonstrate cultural awareness and
respect for individual differences.

25%

Of associates participated in at least
1 of our 10
associate-led NRGs
during 2023.

With nearly 9,700 members, the
Women’s NRG is the largest.

CEO, the Council sets DEI objectives that complement our Talent & Diversity Measure Category and ensures transparency and accountability as they work towards them. Further, the Council has rotating service terms to ensure we empower the associate voice and increase diverse points of view from all levels of the organization.

At our Company, we are committed to having diversity represented at all levels and have developed a pathway for diverse talent within our recruiting initiatives. To support our hiring initiatives, we recruit professionals from organizations across the country that share our commitment to diversity, including national partnerships with Historically Black Colleges and Universities (HBCUs), the Divine Nine historically Black fraternities and sororities, Hispanic-Serving Institutions (HSIs) and professional associations supporting people from diverse backgrounds. In addition, through our Disability Hiring Program, Mature Workers Initiative, and Veterans Hiring Initiative, we connect with a wide array of recruitment sources to create pathways for these groups of professionals to join Humana. We’re proud to be recognized as a Military Friendly employer, and under our Veterans Hiring Initiative, we partner with dozens of organizations for recruitment and have hired thousands of veterans and military spouses.

We’ve also incorporated balanced interview panels into our interview process, through which we strategically engage a broad spectrum of interviewers that bring greater diversity and perspective. This proven best practice strengthens the candidate experience and hiring of diverse talent, ensuring we get the right talent for any given role, and minimizes the potential for personal blind spots when evaluating candidates. While we have resources available to all hiring leaders to leverage, our initial focus is to implement balanced interview panels for director, director equivalent, and above requisitions across the enterprise.

Our inclusion and diversity objectives also aim to build an awareness of biases and beliefs, identify differences and similarities of our multi-generational workforce and enable associates to leverage differences to drive innovation and create value. We are committed to growing our associates’ inclusion skills and diversity knowledgeand provide a variety of associate training programs and workshop opportunities that utilize content developed in-house and through a third-party learning channel. It is also our fundamental belief that every person has the right to a safe workplace.This includes having freedom of gender identity and expression, which we have included within our non-discrimination and anti-harassment policies.

85%

Of associates believe that in their organization, everyone has an equal chance to be successful regardless of individual differences (age, gender, ethnicity/race, religion, etc.).

Building balanced diversity within our workforce is a priority that’s demonstrated in our leadership goals—hiring and promotion of diverse talent, inclusion, mentoring and leaders participating in inclusive leader training—with shared accountability focused on driving inclusion and diversity throughout the enterprise. We encourage our associates to self-identify so that we have a more complete picture of our diverse workforce, understand their experience and can care for their unique needs. This creates a culture where all associates can feel seen, respected, and valued.

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Humana | 2024 Proxy Statement Humana’s Impact


We leverage our Workday system to obtain voluntary self-disclosed demographic information of our associates, allowing us to provide transparent disclosures. The charts below represent our workforce demographics as of December 31, 2023, and use the acronym “BIPOC” to collectively include associates who identify as Black, Indigenous, and/or a Person of Color.

Associate Demographics

LOGO

DEI isn’t a program, a leadership initiative, or even a business imperative. It is simply the way we work, each and every day to deliver on our health first purpose, it’s who we are as an organization, and it’s how we sustain human care. Our associates’ vast experiences and perceptions—their unique characteristics, backgrounds and beliefs—drive the groundbreaking, strategic thinking that gives our Company its competitive edge in a diverse marketplace. Our approach fosters innovative thinking and creativity, expands insights and generates better business outcomes.

Talent & Diversity Measure Category

Workforce Representation in Leadership

We’re working to achieve greater BIPOC representation at leadership
levels of Director equivalent and above to represent the diversity of
our associate population more closely.

2023 BIPOC Director Equivalent +: 22%h 2%

Talent & Diversity Measure Category

Equitable Exits Within Leadership Representation

We’re working to ensure equitable exits among BIPOC in leadership levels of Director equivalent and above, as well as Associate Director/Lead positions and have set a goal of 0% difference within each level.

2023 BIPOC Director Equivalent +: 1.8% (positive retention)

2023 BIPOC Assoc. Director/Lead: 0.5% (positive retention)

Talent & Diversity Measure Category

Leadership Representation in Hiring and Promotions

We’re working to ensure the percent of requisition-based hires and internal promotions reflect representation among BIPOC in leadership levels of Director equivalent and above, as well as Associate Director/Lead positions.

2023 BIPOC Director Equivalent +:  26%h 2% since 2022

2023 BIPOC Assoc. Director/Lead:  35%h 1% since 2022

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Pay and Benefits Philosophy, Compensation and Financial Security

We believe all of our associates have the right to receive a competitive wage and we are committed to maintaining a pay and benefits philosophy that is market-based and recognizes an associate’s contributions so that we can attract and retain an engaged, talented team. Further, we believe in fostering a fair and inclusive work environment—one where all associates receive equitable pay for their contributions. Each year, we conduct a comprehensive pay equity/gap analysis to identify and address potential pay disparities between associates performing similar work in similar capacities. Our Company’s pay and benefits structure is designed to motivate, incentivize and reward our associates—at all levels of the organization—for their skill development, demonstration of our values and performance. While our programs vary by location, associate type and business, they generally include:

LOGO

Financial

  Competitive base pay, with additional incentive, supplemental, and/or recognition pay

  401(k) retirement savings plans with Company match program

  Health savings account (HSA) and flexible savings account (FSA) contributions

  Life Insurance

  Short – and long-term disability insurance

  Tuition assistance program

  Paid internships

  Comprehensive financial well-being programs and support, including an employer-sponsored personal emergency savings account with matching funds from the Company

  Charitable gift matching program

   LOGO

Health

  Medical, dental and vision benefits

  Supplemental health benefits

  Long-term care insurance

  Whole-person well-being and rewards programs and platform

  Incentives for engaging in well-being programs

  Weekly paid well-being time

  On-site health and fitness centers

  On-site health screenings and vaccinations

  On-demand fitness classes, nutritional education through teaching kitchens, and digital coaching apps

LOGO

Life

  Paid time off, paid holidays, paid volunteer time off, and jury duty pay

  Adoption assistance

  Paid parental leave program (6 weeks)

  Paid caregiver time off program (2 weeks)

  Nursing moms program with on-site lactation rooms

  Mental health support, including our robust Employee Assistance Program and Work-Life Services

  Employee discount programs and services

  Helping Hands program

  Transit services

LOGO

 Learning &

 Development

  Diversity, equity, and inclusion training

  Internal and external learning events

  Access to degree and certification programs with tuition assistance

Talent Development and Growth Opportunities

We champion the individual goals and development of our associates and provide many programs and resources to support their efforts. The Humana Learning Center gives our associates the opportunity to earn professional certifications through continued education programs and to participate in instructor-led and online courses designed to strengthen soft and hard-skills and enhance leadership development. Our Career Cultivation team sponsors workshops and events to promote associate accountability within their personal and professional growth as part of overall career development. In 2023, our associates averaged approximately 49 hours per active full-time associate in learning and development activities. In addition, people leaders collectively spent nearly 143,000 total hours in learning and development; of which, over 17,400 hours (12%) were related to content specific to leadership development. As a result, our Company spent approximately $193 per active full-time associate (or equivalent) toward our associates’ continued learning and development in 2023.

Our associates are also encouraged to participate in mentoring programs with people of various backgrounds and cultures. We view mentoring as an essential development tool for sharing skills and knowledge so we can all succeed. Our commitment to mentoring feeds the successful future of our Company and through our efforts over 5,800 associates engaged in active mentoring relationships during 2023. We also utilize development programs to enhance talent within our business segments through targeted internal initiatives, where we aim to upskill and reskill existing associates for opportunities in new career pathways.

We’re pleased that these initiatives are being embraced by our associates and that 83% of our associates reported that they believe their job makes good use of their talents, skills, and abilities.

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Humana | 2024 Proxy Statement Humana’s Impact


78%

Of associates believe Humana provides
them with opportunity for growth and
development.

281,132

Volunteer hours tracked by 20,996 of our
associates in 2023.

$2.4 Million

Total associate matching gift dollars made
by The Humana Foundation in 2023 to
8,655 unique organizations.

A Workplace With Purpose

Having a purpose and a connection to a community improves well-being. That’s why we strive to make it easy for our associates to give back, either as individuals or a team, to causes that ignite their passion and sense of purpose. Volunteerism is a tangible way to impact the health and well-being of the communities we serve and enrich our workplace.

We’ve created programs and practices to make volunteering easier and more vibrant for associates.

Our full-time associates annually receive eight hours of paid Volunteer Time Off (VTO) and last year 123,809 VTO hours were used by 16,702 of our associates.

We help associates discover and track volunteer opportunities through our Humana Together volunteer portal.

We integrate volunteerism in our leadership development and team building.

We offer a matching charitable gift program through The Humana Foundation.

We feature associates sharing their volunteerism stories on our Intranet and social media sites to inspire others.

We help our associates by reducing barriers in taking time away from work to get vaccinated, which in turn supports healthy communities.

Addressing the Needs of Our Members and Patients

Helping each of our members and patients achieve their optimal whole-person health has long been a strategic imperative for Humana. Whether it’s by focusing on preventive and primary care, managing health conditions, setting and achieving health-related goals, or finding the right care in the right place – at home, in the community, or through telehealth – we help make the journey toward health simpler for our members.

We’re also continuously working to ensure that our health plan products and services are as affordable as possible, while also creating pathways for access to healthcare, addressing social determinants of health (SDoH) and health-related social needs of our members and patients. Our work in these areas is essential to advancing health equity, improving health outcomes, and delivering necessary care. Thanks to processes such as integrated care delivery and using health screenings that consider SDoH and health literacy, we have a clearer view of each member’s very personal barriers to their best health. Please refer to our Value-Based Care Report for more information on these efforts.

Access to Healthcare Measure Category

Value-Based Primary Care

Expand Geographic Presence

We’re working to grow and expand our geographic presence in value-based primary care to provide more access and high-quality care to patients, including those in underserved areas. We ended 2023 with 296 primary care centers, representing a 26% increase over the prior year.

Access to Healthcare Measure Category

State Medicaid

Increase Medicaid Footprint

We’re working to expand the number of our state-based Medicaid contracts to deliver care to more individuals of this vulnerable population. As of January 1, 2024 we have Medicaid contracts in nine states: FL, IL, IN, KY, LA, OH, OK, SC, and WI.

For Each Community

LOGO

We engage and partner with city-, state-, and nationwide organizations that are making a daily impact in the communities we serve. Through volunteering, monetary investment and strategic collaboration, we’re able to multiply the impact of those on the ground and transform care through our commitment to reducing health disparities and advancing health equity for our members, patients and communities.

$10 Million

Invested by Humana Healthy
Horizons
in 2023 to support
communities across Humana’s
entire Medicaid footprint.

Our Health Equity & Social Impact team is working to address social needs and reduce health disparities to improve health outcomes for our members and communities. As part of their mission to establish health equity as a key business and culture driver, they offer insights to embed healthy living opportunities in our products and services, train associates and providers to help them offer more meaningful care and enable new insights through data-driven innovations. Their work centers on creating an equitable healthcare ecosystem so that every person has a fair, just and dignified

opportunity to reach their full health potential. By focusing on health equity, we work to bridge the gaps that have historically hindered access to and quality of care, while enabling our members and patients to receive the care they need, when and where they need it.

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33


The Humana Foundation, the philanthropic arm of Humana Inc., launched a new strategy during 2023 that is focused on health equity, and fostering evidence-based collaborations and investments that support seniors, Veterans, underrepresented populations and school-aged children so that they may experience connected, healthy lives. The new approach also focuses on eliminating the social and structural barriers to good health and healthcare through evidence-based interventions and solutions. By partnering with local communities and trusted community organizations in Florida, Louisiana, Louisville, Kentucky, and Texas, The Humana Foundation works to create a network of support for people confronting life’s challenges, regardless of their age, race, ethnicity or gender identity.

$5.32 Million

Donated in 2023 by The Humana Foundation to create healthy emotional connections for seniors, school-aged kids and veterans through partnerships and initiatives to address loneliness and prevent suicide such as reducing veteran suicide among diverse, underserved populations with the launch of the Face the Fight initiative.

$1.35 Million

Awarded in 2023 by The Humana Foundation through its Health Equity Innovation Fund to identify and scale innovative solutions to disparities in mental health and nutrition, including awarding $250,000 to the Home of the Innocents in Louisville, Kentucky.

For the Healthcare System

LOGO

Throughout our operations, we are dedicated to ensuring that every business decision we make reflects our commitment to improving the health and well-being of our members and patients, our associates, the communities we serve, and our environment. Our holistic, integrated approach to care and longstanding commitment to caring for vulnerable

populations also afford us a unique opportunity to promote health equity and address the effects of health disparities in the U.S. healthcare system. We have established policies and programs that illustrate our commitment to responsible business practices that lead to a more efficient, equitable and sustainable healthcare system.

Supplier Diversity

Diversity, Equity, and Inclusion is integral to how we practice, deliver and sustain human care to the communities we proudly serve, which is why we incorporate ESG principles into our procurement strategy—ensuring a fair and equitable approach to procurement. We understand that partnering with diverse suppliers and small businesses, and engaging with them to support common ESG goals, can lead to future sustainability and a reduction in environmental costs. We also understand that inclusive procurement practices deliver broad societal benefits by creating economic opportunities for traditionally underserved or underrepresented groups. That’s why we’ve made it a priority and strive to attract qualified, certified suppliers who reflect our members, patients, associates and the communities we serve. Leveraging these suppliers now and in the future is a win-win for everyone.

Our Supplier Diversity Program promotes an inclusive approach to procurement that ensures we invest our dollars with a balance of partnerships with historically underutilized businesses. We also support the growth of small and diverse-owned businesses by being a resource partner for them, through initiatives like our Supplier Diversity Mentor-Protégé program. The program has a 12-month term with half-day, onsite seminars that feature leadership from across our organization exploring topics impacting business growth and operations of small and diverse businesses. The program is designed to identify and overcome barriers that typically inhibit or restrict the success of small and diverse businesses and better position them for growth, sustainability and inclusion.

We also survey suppliers annually through a sustainability scorecard that addresses sustainability, diversity practices and supplier performance. The scorecard is distributed to our Prime Suppliers (top spend suppliers) and we typically receive a 25-30% overall spend response rate. We also hold our suppliers accountable for complying with our Company’s Standard of Excellence and Ethics Every Day policy – to the same degree as our associates.

Governance and Accountability

Throughout our operations, we are dedicated to ensuring that every business decision we make reflects our Standards of Excellence, commitment to accountability, health equity and improving health and well-being. Our governance practices and policies reflect strong controls that provide a solid foundation for our continued success.

Product Quality and Safety Assurance. We are committed to supporting the delivery of consistent high-quality care, promoting efficient outcomes in the healthcare system and ensuring that healthcare remains affordable for all members and patients. As a services-focused healthcare company, we understand that our members and patients expect us to design high-quality service offerings with careful attention to safety measures. We believe that the quality of our services and health plan offerings are not only a factor in a person’s decision to both obtain and retain our services, but also set us apart as a leader in the industry. We have well-established and rigorous quality reviews and assessment processes for all our insurance and CenterWell offerings, and we’re proud that our efforts have been consistently proven with our CMS Star Ratings and other prominent accreditations.

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Humana | 2024 Proxy Statement Humana’s Impact


Further, in a healthcare industry increasingly driven by quality, we have a corporate Quality Improvement (QI) program – with practicing network physicians as members of various quality subcommittees – to monitor, evaluate and facilitate improvement in the quality of health care services provided to our members. The QI program is overseen by our Corporate Quality Improvement Committee (CQIC), which among other things, promotes alignment to the third dimension of quality (experience and outcomes) through collaboration with stakeholders, personal accountability and speaking up when quality does not meet our standards.

Ethics and Compliance.Our associates are integral to responsibly running our company and key to our ethics and compliance practices. Through our comprehensive ethics and compliance training programs, we empower our associates to navigate the landscape of healthcare and corporate governance with a clear understanding of their roles and responsibilities, including our standard of conduct. That’s why we require Humana’s

99.72%

Of associates completed the 2023
ethics and compliance training by the
annual due date.*

independent directors, executive officers and all other associates, and contractors to complete an annual ethics andcompliance training course, which includes detailed training in cybersecurity, whistleblowers, conflicts of interest and more. Associates on an approved leave of absence are not required to complete the training until they return to work.* In addition to required annual training, our Enterprise Compliance team regularly communicates and engages with associates on ethics and compliance topics throughout the year.

We also enforce a public Ethics Every Day policy as our standards of conduct, have an established Corporate Compliance Program, and adhere to a public set of Standards of Excellence. Additionally, we enforce Humana’s standards of conduct and compliance policies specifically designed for our contracted healthcare providers and third parties to deter fraud, waste and abuse. We require our contracted healthcare providers and third parties to uphold a similar commitment to ethical conduct and assure that they, their employees and downstream entities who support our Company comply with the guiding principles outlined in the compliance policy.

Responsible Data Use and Data Privacy. As we evolve to deliver more services and goods through digital operations, we recognize our responsibility to protect member data and patient privacy, as well as use enterprise-level analytics to continue to equitably innovate for those we serve. Integrating digital capabilities across the organization will further accelerate our Company’s move toward differentiated experiences for our customers at the intersection of healthcare and lifestyle, tailored especially to the needs of seniors. We recognize that our emphasis on technology comes with great responsibility as our customers trust us with keeping their information safe. To that end, we are proud to be an industry leader in the adoption of principles and governance to guide our implementation of emerging technologies through interdisciplinary committees that establish governance over the deployment and quality of Artificial and Augmented Intelligence models. We have also signed the EqualAI pledge committing to ensuring our Artificial and Augmented Intelligence tools do not incorporate unintentional bias, and we require all of our Artificial or Augmented Intelligence models that inform decisions about individuals to be reviewed to detect inadvertent bias. We further ask our vendors who utilize Artificial and Augmented Intelligence tools to sign the EqualAI pledge or another similar pledge.

Cybersecurity.Trust is the foundation of healthcare relationships, and we take our responsibility to protect sensitive information seriously. We adhere rigorously to the Health Insurance Portability and Accountability Act (HIPAA), a federal law designed to ensure the privacy of personal and health information. We are also committed to continuously enhancing and strengthening our technology infrastructure and security protocols to protect against security breaches. Further, we have established formal data governance, which includes accountability, oversight, processes and controls to ensure our data usage transparency and nonrepudiation, and we refresh our data privacy and security policies at least annually. We employ best-practice precautions to safeguard information and protect our members’ data by deploying defensive practices against the ever-evolving cyber threat landscape. Examples of these practices include:

Employing a qualified Chief Information Security Officer

Maintaining tools to identify malicious cyber activity

Monitoring risks posed by threat actors, including through partnerships with industry groups and government agencies.

Providing annual cybersecurity training to our associates

Testing our associates’ knowledge through internal phishing simulations

Hosting a multi-day learning event annually during National Cyber Security Awareness Month, an opportunity for all of our associates and contractors to learn more about cybersecurity awareness, hear from industry and cyber-crime experts, and collaborate with colleagues

Reporting data breaches, as required by law, to the U.S. Department of Health and Human Services (HHS), Office for Civil Rights (OCR), and various state agencies; our reports are publicly available, free of charge, and can be obtained through the OCR Portal at https://ocrportal.hhs.gov/ocr/breach

Maintaining a program to identify cybersecurity risks associated with certain third-party vendors, which is one component of an overall vendor risk management capability

To further reinforce our accountability in this area and verify compliance with state laws and regulations, we engage independent third-party firms to perform annual audits of the Service Organizational Controls 2 (SOC 2) of enterprise claims platforms within the following Trust Services Criteria: availability, confidentiality, security and processing integrity.

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Additionally, our IT infrastructure and information security management systems are both internally and externally audited. These audits have resulted in us receiving industry-recognized certifications from organizations such as the Health Information Trust Alliance (HITRUST certification), derived from the ISO/IEC 27000 family of standards; National Institute of Standards and Technology (NIST) compliance; and Payment Card Industry Data Security Standards (PCI-DSS) certification. These objective certifications and compliance standards provide transparency and substantiate the efficacy of our world-class security program.

Associate Physical Safety and Security.Health and safety are at the very core of our organization’s values and underscore our belief that health is holistic. Our commitment to health and safety extends beyond our patients and members and to our associates, where it is also our duty to ensure their safety and well-being at work. Our governance, policies and procedures—guided by Occupational Safety and Health Administration (OSHA)

0.47

2023 OSHA Total Recordable Incident Rate for all Humana lines of business

regulations—help protect the health and safety of our associates, contractors, members and visitors, providing each with a safe and secure work environment. We are dedicated to protecting people and safeguarding key assets, properties and information, understanding that a safe workplace is essential to fostering a culture of well-being and belonging.

We have an established occupational health and safety management system documented through our Environmental Health and Safety (EH&S) Manual. Created to reduce risk and loss associated with fire, disaster, workplace accidents, work-related illnesses and other occupational hazards, the EH&S Manual is owned and maintained by our Humana Safety and Security team, whose activities are overseen by Humana’s Senior Vice President of Enterprise Associate & Business Solutions, with ultimate accountability to Humana’s Chief Administrative Officer. Our Enterprise Safety and Security Policy applies to our associates, facilities (owned or leased) and anyone requesting facility admittance. All associates, contractors and vendors are expected to support our efforts in maintaining safe and secure facilities.

Talent & Diversity Measure Category

Diverse Supplier Spend

Increase Supplier Diversity

We’re working to increase our diverse supplier base through an inclusive and equitable approach to procurement and set yearly goals to increase total diverse supplier spend among our Prime Suppliers.

Our 2023 target increase was 9%.

2023 Total Diverse Spend: $357 million, or 6.5% of total supplier

spend, representing a 2.4% decrease since 2022

Product Quality & Safety Measure Category

Star Ratings

Continue Leadership of Members in MA Plans with 4+ Star Rating

Our commitment to quality of care, patient-centered clinical outcomes and customer service is reflected in the consistent strength of our MA plan’s Star Ratings.

Membership in MA plans with 4+ Star Rating***:

Nearly 5.5 million, or 94%, of members are enrolled in plans

rated 4 stars and above for 2024

For the Environment

LOGO

We know that transforming healthcare requires transforming the way we address environmental risks to health. Our commitment to the health of our planet is stronger than ever. We recognize there is an undeniable link between our physical and emotional well-being and the health of the environment. To that end, we are continuing to invest our time and resources where it matters most—not just because it’s good business practice, but because we believe in a bright future.

We also understand that health is local, so we are engaged at a state and community level to address the health-related social needs of our members and communities, especially communities that have been historically underserved. Those same communities are often disproportionately affected by climate change, as evidenced in health outcomes and disaster recovery data, so we know our focus on these areas can have a significant impact.

As a services company, our direct environmental impacts are concentrated within our internal operations. As such, our focus is on areas where we feel we can make the most impact: reducing our greenhouse gas emissions (GHG) and waste from our operations; deploying water conservation efforts; and adopting renewable energy solutions. We understand that climate change impacts pose risks and opportunities for our business and seek to manage such impacts in several ways, including: continuous strengthening of our already robust business continuity program, investing in energy management and efficiency projects and applying financial incentives to support efforts toward reducing our environmental footprint. We also set challenging environmental targets, as shown below, that promote collaboration with vendors and associates to achieve them. These efforts mitigate risks and demonstrate our commitment by validating the intrinsic link between environment and health.

Our Workplace Solutions (WPS) Environmental Sustainability team, overseen by our Chief Administrative Officer, aims to support Humana’s lifelong well-being strategy by ensuring that we are doing our part to take on climate change, pollution and other environmental factors that impact our health. This team is responsible for day-to-day planning, coordination and implementation of the Company’s operational environmental sustainability policies, including those around energy management and climate-change mitigation/adaptation.

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Humana | 2024 Proxy Statement Humana’s Impact


We provide a full report of our GHG emissions, energy consumption and water usage within our Impact Report, available on our website at www.humana.com, then click “Humana’s Impact,” and refer to the “Environmental Year-over-year Data Inventory Table.” We also align our environmental reporting to the framework established by the Task Force on Climate-Related Financial Disclosures (TCFD). We encourage you to review our Environmental Sustainability Policy Statement and our CDP Report to learn more about our sustainability efforts and areas of concentration.

Reducing Emissions Through Science-based Targets

In 2021, we announced our intention to create a more robust next generation environmental goal to address climate change that would align with criteria established by the Science Based Targets initiative (SBTi). In 2022, we presented our science-based targets (SBT) proposal to SBTi for official validation. In 2023, SBTi officially accepted and validated our SBT, recognizing that our submitted science-based greenhouse gas emissions reductions target(s) conform with the SBTi Criteria and Recommendations (Criteria version 5.0), and SBTi has classified our Company’s Scope 1 and Scope 2 target ambition as in-line with a 1.5°C trajectory.

Our near-term SBT expands on our efforts to reduce emissions and waste through Scope 1 and Scope 2 initiatives and is designed to spur innovation and efficiency, boost investor confidence and align with national benchmarking. Among other strategies, our efforts to reduce Scopes 1 and 2 greenhouse gas emissions include continued investment in and improvements to energy efficiencies and optimization of our portfolio. We are also maintaining focus on reducing the amount of waste generated.

We understand that a path forward to net zero emissions is important to our collective future and we’re analyzing tactics, appropriate to our business, that allow us to utilize our SBT to contribute to future net zero goals.

Our commitments to the environment encompass a comprehensive approach that not only addresses our direct impacts, but also our broader energy consumption. While we continue to refine the strategies and undertakings necessary for us to fully achieve our SBT, we have identified the groundwork initiatives below within each scope.

LOGO

Scope 1 and Scope 2

Groundwork Initiatives

    

Scope 3

Groundwork Initiatives

•  Increase energy efficiency and optimization within our infrastructure:

–  Maintain progress with ENERGY STAR®certifications

–  Application of short- and long-term renewable energy procurement sources, beginning with the purchase of renewable energy credits (RECs) in deregulated markets in-line with our energy procurement strategy

•  Fleet transition from traditional to hybrid vehicles

•  Aviation emissions reduction targets associated with National Business Aviation Association (NBAA) Sustainable Flight Department Accreditation Program

•  Engage and partner with our suppliers to encourage sustainability goals within our supply chain and connect them to resources to establish science-based targets for their organizations

•  Promote sustainable transportation choices and alternative workstyle opportunities available to our associates

•  Review and monitoring of investment portfolio to identify and reduce finance emissions

Renewable Energy

Much of our renewable energy effort has gone toward making Humana’s buildings more efficient, including making repairs and replacing equipment, resulting in a better associate experience and more energy-efficient buildings. Our headquarters in downtown Louisville, Kentucky has been retrofitted with solar panels on the rooftop, and we’re in the process of evaluating the best sites to install renewable energy. As part of our efficiency work, we use certifications to benchmark how well our buildings are performing, including ENERGY STAR certification.

We’re continuing to replace all lights in all of our owned and leased facilities with LEDs and pursuing the goal of reaching ENERGY STAR certification in all eligible Humana locations. ENERGY STAR certified sites on average use 35% less energy than comparable sites, and Humana will continue to leverage ENERGY STAR as a key measure to help achieve our science-based target.

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37


Fleet and Aviation

We’re also working toward energy efficiencies within our mobile vehicles and aircrafts. Our fleet inventory expanded due to the number of vehicles needed to accommodate the CenterWell Home Health business, especially clinicians visiting patients in their homes. These vehicles are essential as our clinicians deliver care to patients in their homes—as a means to expand access to care and for our patients’ convenience—and are necessary as part of our home health business model. We know that vehicle emissions have a negative effect on the environment, so we are making an effort to reduce our emissions footprint by transitioning our traditional vehicle fleet to hybrid vehicles. Our clinicians can continue using vehicles to meet with and deliver care to patients at their place of residence with peace of mind knowing that they are contributing to a positive impact on air quality around our patients’ homes and communities.

Our Aviation team applied for the National Business Aviation Association (NBAA) Sustainable Flight Department Accreditation Program and earned NBAA accreditation in Flight, Operations, Ground Support and Infrastructure. The team continues to work toward their goal of a 20% reduction in emissions over the 3-year certificate period. To contribute to this goal and identify practices that can be implemented to minimize the impact on the environment, the Aviation team has been exploring alternative jet fuel options, replacing diesel tugs (aircraft towing devices) with electric options, changing fluorescent bulbs with LEDs and using compostable containers, among other efforts.

Digital Adoption

Our dedication to reducing our environmental footprint includes the adoption of digital solutions and paperless communications. Core to this commitment is our drive to encourage email opt-ins and grow our digital marketing universe. By promoting electronic communication channels, we aim to minimize the need for print and postage, reducing waste and production costs associated with traditional mail. Our digital efforts also include investments in other online capabilities, providing members with faster and easier access to their benefits information, claims information, plan documents, ID cards and provider directories. These measures align to our broader sustainability goals and underscore our commitment to responsible, eco-conscious business practices.

Environmental Impact Measure Category

Paper Reduction

Print and Postage Savings

We’re working to reduce print and postage costs by making it easier to sign-up for and receive paperless communications in addition to transitioning more communications to digital channels. Our cumulative print and postage savings goal was $5 million by the end of 2023.

Cumulative Goal Achievement:

$21.8 million, representing a $16.8 million increase

over our initial $5 million goal

Environmental Impact Measure Category

Digital Adoption Rate

Increase Paperless Communications

We are working to increase the digital adoption rate (DAR) of among members who enroll in paperless communications, our focus remains on email opt-in preference for contact versus standard mail. Our goal is to increase the number of members who enroll for paperless communications by 15% (from 11% to 13%) by 2025.

2023 Goal Progress:

15.7%, or 119% of goal

Environmental Impact Measure Category

Digital Marketing

Grow Digital Marketing Universe

We’re working to grow our net digital marketing universe by 10% by the end of 2025 with an increase in the DAR among members who enroll in paperless communications and complete their MyHumana registration.

2023 Goal Progress:

14.2%, or 133% increase

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Humana | 20222024 Proxy Statement Proposal OneHumana’s Impact

 


Additional ESG Resources

Humana Impact Report

https://www.humana.com/about/impact

Policy Statements

https://humana.gcs-web.com

-   Environmental Sustainability Policy & Standard

-   Supplier Diversity Statement

-   Statement of AI Principles

Ethics

https://humana.gcs-web.com/corporate-governance

-   Ethics Every Day

-   Anti-Corruption Statement

Supplier Diversity Program

https://www.humana.com/supplier-information/supplier-diversity

Value-Based Care Report

https://www.humana.com/provider/news/value-based-care

Health Equity

https://healthequity.humana.com

Data Privacy and Cybersecurity

https://www.humana.com/legal/privacy-policy

Standards of Excellence

https://www.humana.com/about/standards-of-excellence

Health Policy Center

https://policy.humana.com

Humana Healthcare Research

https://research.humana.com/

The Humana Foundation

https://www.humanafoundation.org

Fraud, Waste, and Abuse

https://www.humana.com/legal/fraud-waste-and-abuse

-  Ethics Every Day for Contracted Healthcare Providers & Third Parties

-  Compliance Policy for Contracted Healthcare Providers & Third Parties

Humana’s Impact 2024 Proxy Statement | Humana

39


Awards and Recognition


Director CompensationWe are pleased to have received national recognition for our ESG efforts and we appreciate the acknowledgement of our commitment to inspiring health and well-being. Highlighted below are just a few of our notable achievements, however a complete list of awards and recognition is available on our website at www.humana.com – from there click on “About Humana,” and then click on “Awards and Recognition.”

 

LOGO

2021

40

Humana | 2024 Proxy Statement Humana’s Impact


Director Compensation

2023 Director Compensation Program

During 2021,2023, our non-employee directors were compensated pursuant to the following schedule:

 

  

Annual Retainer(1)(4)

  

$115,000  

120,000

 

Non-Employee Chairman of the Board

Additional Annual Retainer

  

$210,000  

240,000

 

Committee Chairman fee per year:

1. Audit Committee Chair

2. Organization & Compensation Committee Chair

3. All other Committee Chairs

  

$25,000

$20,000

$15,000

 

Executive Committee Member fee per year

  

$12,000

 

Common Stock per year

(1st Business Day of January)(2)(4)(5)

  

$165,000190,000 in common stock

(variable # of shares)

 

Charitable Contributions Annual Match

  

up to $40,000

 

Group Life and Accidental Death Insurance —

(except Chairman)(5)(6)

  

$150,000 of coverage

 

Group Life and Accidental Death Insurance — Chairman

(6)

  

$400,000 of coverage

 

Business Travel Accident Insurance

  

$250,000 of coverage

 

Restricted Stock Units

Granted Initial Date of Election(3)

  

Restricted Stock Unit grant equal to the dollar value

of the then current annual stock grant for directors

 

 

(1)

The annual cash retainer for each non-employee director is paid in equal amounts on a monthly basis during the service year. If a director ceases service on the Company’s Board of Directors during a year, the final cash retainer payment will be for the final month during any portion of which the director serves on the Company’s Board of Directors. A non-employee director will receive the full annual cash retainer amount for the initial year in which the director serves on the Company’s Board of Directors, regardless of the director’s initial date of election.

(2)

The annual common stock retainer is paid in the form of restricted stock units, vests at the end of the year of service related to the retainer and will be pro-rated for any service of less than the full year in respect of which the award is granted.

(3)

The initial award of restricted stock units is forfeited if the director serves less than one year on the Company’s Board of Directors. This initial award is in lieu of the annual common stock retainer for the year in which the director was first elected to the Board, but the director would receive the annual common stock retainer commencing in January of the year following election.

(4)

Pursuant to our revised Directors Stock Retention Policy, each non-employee director must maintain a minimum equity ownership level of five times the annual cash retainer. For additional information, please refer to “Corporate Governance — Corporate Governance Policies — Director Stock Ownership Guidelines” in this proxy statement.

(5)

Pursuant to the Company’s 2019 Amended and Restated Stock Incentive Plan, in no event shall any non-employee director of the Company be granted Awards that would result in total compensation for such director in connection with their service on the Company’s Board of Directors in excess of (a) with respect to a non-employee director, $1,000,000, and (b) with respect to a non-employee Chairman of the Board, $1,500,000, in each case, in any calendar year.

(6)

Coverage amount decreases 50% at age 70.

 

Director Compensation  2022 2024 Proxy Statement | Humana

 

     41


20212023 Compensation of Our Directors

The following table shows the compensation earned by our non-employee directors in connection with their service on our Board of Directors during all or a portion of the 20212023 fiscal year:

 

Name(1)

(a)

  

Fees
Earned
or

Paid in

Cash

($)(3)

(b)

   

Stock

Awards

($)(3)(4)(5)
(c)

   

Option

  Awards  

($)

(d)

   

Non-Equity

Incentive Plan

 Compensation 

($)

(e)

   

Change in
Pension

Value and
Nonqualified
Deferred

 Compensation 

Earnings($)(7)

(f)

  

All Other

 Compensation 

($)(8)

(g)

   

Total

($)

(h)

 

Frank J. Bisignano(2)

  

 

38,333

 

  

 

54,838

(6) 

  

 

—  

 

  

 

—  

 

  

 

—  

 

 

 

40,183

 

  

 

133,354

 

Name(1)(2)

(a)

Fees
Earned
or

Paid in

Cash

($)(3)

(b)

Stock

Awards

($)(3)(4)(5)
(c)

Option

 Awards 

($)

(d)

Non-Equity

Incentive Plan

 Compensation 

($)

(e)

 

Change in
Pension

Value and
Nonqualified
Deferred

 Compensation 

Earnings($)(7)

(f)

All Other

 Compensation 

($)(8)

(g)

Total

($)

(h)

Raquel C. Bono, M.D.

  

 

115,000

 

  

 

164,924

 

  

 

—  

 

  

 

—  

 

  

 

—  

 

 

 

1,188

 

  

 

281,112

 

 

124,000  

 

190,129  

 

— 

 

— 

 

— 

 

30,900

 

345,029  

Frank A. D’Amelio

  

 

140,000

 

  

 

164,924

 

  

 

—  

 

  

 

—  

 

  

 

—  

 

 

 

2,288

 

  

 

307,212

 

 

145,000  

 

190,129  

 

— 

 

— 

 

— 

 

28,421

 

363,550  

David T. Feinberg, M.D.

 

130,000  

 

190,129  

 

— 

 

— 

 

— 

 

1,388

 

321,517  

Wayne A. I. Frederick, M.D.

  

 

115,000

 

  

 

164,924

 

  

 

—  

 

  

 

—  

 

  

 

—  

 

 

 

40,414

 

  

 

320,338

 

 

133,300  

 

190,129  

 

— 

 

— 

 

— 

 

41,445

 

364,874  

John W. Garratt

  

 

130,000

 

  

 

164,924

 

  

 

—  

 

  

 

—  

 

  

 

—  

 

 

 

8,414

 

  

 

303,338

 

 

135,000  

 

190,129  

 

— 

 

— 

 

— 

 

904

 

326,033  

Kurt J. Hilzinger

  

 

337,000

 

  

 

164,924

 

  

 

—  

 

  

 

—  

 

  

 

—  

 

 

 

43,168

 

  

 

545,092

 

 

368,000  

 

190,129  

 

— 

 

— 

 

— 

 

43,171

 

601,300  

David A. Jones, Jr.

  

 

142,000

 

  

 

164,924

 

  

 

—  

 

  

 

—  

 

  

 

(13,552

 

 

41,188

 

  

 

334,560

 

 

49,000  

 

63,543  

 

— 

 

— 

 

224,175

 

45,379

 

382,097  

Karen W. Katz

  

 

115,000

 

  

 

164,924

 

  

 

—  

 

  

 

—  

 

  

 

—  

 

 

 

19,938

 

  

 

299,862

 

 

130,000  

 

190,129  

 

— 

 

— 

 

— 

 

26,425

 

346,554  

Marcy S. Klevorn

  

 

115,000

 

  

 

164,843

 

  

 

—  

 

  

 

—  

 

  

 

—  

 

 

 

20,990

 

  

 

300,833

 

 

135,000  

 

190,129  

 

— 

 

— 

 

— 

 

26,811

 

351,940  

William J. McDonald

  

 

115,000

 

  

 

164,924

 

  

 

—  

 

  

 

—  

 

  

 

—  

 

 

 

42,268

 

  

 

322,192

 

 

120,000  

 

190,129  

 

— 

 

— 

 

— 

 

46,030

 

356,159  

Jorge S. Mesquita

  

 

115,000

 

  

 

164,843

 

  

 

—  

 

  

 

—  

 

  

 

—  

 

 

 

990

 

  

 

280,833

 

 

120,000  

 

190,129  

 

— 

 

— 

 

— 

 

41,456

 

351,585  

James J. O’Brien

  

 

135,000

 

  

 

164,924

 

  

 

—  

 

  

 

—  

 

  

 

—  

 

 

 

42,286

 

  

 

342,210

 

 

46,700  

 

63,543  

 

— 

 

— 

 

— 

 

41,221

 

151,464  

Marissa T. Peterson

  

 

130,000

 

  

 

164,924

 

  

 

—  

 

  

 

—  

 

  

 

—  

 

 

 

774

 

  

 

295,698

 

 

Brad D. Smith

(1)

During 2021,2023, Mr. Broussard served as President and Chief Executive Officer of the Company, and therefore, as an employee director, did not earn compensation in connection with his service on our Board. Mr. Broussard’s compensation as our Chief Executive Officer is discussed under “Executive Compensation” in this proxy statement.

(2)

Mr. BisignanoMessrs. Jones and O’Brien did not stand for re-election at the April 22, 202120, 2023 Annual Meeting of Stockholders. Compensation disclosed represents amounts earned for service during 20212023 prior to his departuretheir departures from our Board.

(3)

Under the Humana Inc. Deferred Compensation Plan for Non-Employee Directors, which we refer to as the Deferred Compensation Plan, non-employee directors may make an irrevocable election each year to defer compensation paid to them by the Company in the form of cash or stock for services rendered as Board members. For 2021, Ms.2023, Mmes. Katz and Klevorn, Drs. Bono, Feinberg, and Frederick, and Messrs. D’Amelio, Garratt, Hilzinger, McDonald and McDonaldSmith each deferred their stock compensation. Refer to footnote 1(c) to the section entitled “Stock Ownership Information — Security Ownership of Directors and Executive Officers” for a disclosure of the number of Shares of our common stock that have been deferred by each director. A director electing to defer cash can choose any of the investment options offered in the Deferred Compensation Plan using Charles Schwab’s Retirement Plan Services (other than the Humana Common Stock Fund) or can invest in stock units that have a value relative to that of our common stock. For 2021,2023, Ms. Katz, Drs. Feinberg and Frederick, and Messrs. Garratt, Hilzinger, and McDonald and Mmes. Katz and PetersonSmith each elected to defer a portion or all of their cash compensation under the Deferred Compensation Plan.

(4)

On January 4, 2021,3, 2023, when the fair market value of our common stock was $409.24,$500.34, each director in office at that time, other than Mr. Broussard, was granted a restricted stock unit award of 403380 Shares, representing the annual grant of approximately $165,000$190,000 in common stock. Ms. Klevorn and Mr. Mesquita each received a restricted stock unit award representing approximately $165,000 upon their election date, using the fair market value of our common stock on that date ($378.08) to determine the 436 Shares awarded. The amount shown in column (c) (“Stock Awards”) above is the grant-date fair market value times the number of Shares awarded calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification (FASB ASC) Topic 718.

(5)

Vested restricted stock units with a payout deferral election made by the director accrue quarterly dividend equivalent rights that are reinvested into the director’s account as additional restricted stock units and will be included in the final restricted stock unit payment when the Shares are issued in accordance with the director’s payout election. This column does not include dividend equivalent units that have accrued through December 31, 20212023 nor includes dividend equivalent rights paid on any such deferred Shares.

(6)

Pursuant to equity award agreements, unvested restricted stock units will be prorated upon vesting for any portion of the year that the director did not serve. Mr. BisignanoMessrs. Jones and O’Brien each received a prorated number of restricted stock units upon vesting. The value represented above in column (c) is the prorated value of the number of Shares that vested on December 31, 2021,2023, using the grant date fair market value of $409.24.$500.34.

 

42  

Humana | 20222024 Proxy Statement Director Compensation

 


(7)

Non-employee directors elected subsequent to 1997 do not receive any retirement benefits. As he was first elected to the board in 1993, Mr. Jones is the only director that will have retirement benefits under this former retirement policy, including: (A) at the director’s election, either: (x) an annual retirement benefit for the life of the director in the amount of $38,000, the annual retainer fee in effect for 1997; or (y) in lieu thereof, an actuarially equivalent joint and survivor annuity payment; and (B) an annual matching charitable contribution benefit of $19,000 for the life of the director.

(8)

We pay for or reimburse our directors’ travel, lodging and other reasonable out-of-pocket expenses in connection with attendance at board, committee and stockholder meetings. From time to time, we may transport one or more directors and members of their immediate family to and from such meetings or other Company business on Company aircraft. Directors may elect to participate in the medical and dental benefit programs offered to all of our employeesassociates at a rate comparable to the rate paid by employees.associates. In 2021, Mr. McDonald and Mmes.2023, Ms. Katz and Peterson,Messrs. Garratt and McDonald elected to participate. Under the terms of our director compensation policy, each non-employee director who participates in medical and dental plans provided by the Company will, for two years following the date of completion of a change in control, be eligible to participate in medical and dental plans on substantially the same terms as immediately prior to the change in control, including the requirement to pay premiums at the same rates as our associates. We also reimburse directors for other reasonable expenses related to board service, such as director education, which amounts are not included in the table above. In addition, we pay certain local occupational taxes and life and accidental death insurance premiums per outside director, in each case as disclosed below, and provide a matching charitable gift program. The “All Other Compensation” amount above includes the following amounts earned in connection with service on our Board of Directors:

 

Director

 

Matching
Charitable Gift

($)

  

Occupational
Tax

($)

  

Life
Insurance

($)

  

Other

($)

  

Total –

All Other
Compensation

($)

 

Matching

 Charitable Gift 

($)

Matching

 Charitable Gift 

($)

 Occupational 

Tax

($)

 Occupational 

Tax

($)

Life

 Insurance 

($)

Life

 Insurance 

($)

 Other 

($)

 Other 

($)

 

Total –

All Other
 Compensation 

($)

 

Total –

All Other
 Compensation 

($)

Frank J. Bisignano

 

 

39,787

 

 

 

—  

 

 

 

396

 

 

 

—  

 

 

 

40,183

 

Raquel C. Bono, M.D.

 

 

—  

 

 

 

—  

 

 

 

1,188

 

 

 

—  

 

 

 

1,188

 

 

28,500

 

114

 

2,286

 

— 

 

30,900

Frank A. D’Amelio

 

 

1,100

 

 

 

—  

 

 

 

1,188

 

 

 

—  

 

 

 

2,288

 

 

26,000

 

135

 

2,286

 

— 

 

28,421

David T. Feinberg, M.D.

 

— 

 

200

 

1,188

 

— 

 

1,388

Wayne A. I. Frederick, M.D.

 

 

40,000

 

 

 

—  

 

 

 

414

 

 

 

—  

 

 

 

40,414

 

 

40,000

 

122

 

414

 

909

 

41,445

John W. Garratt

 

 

8,000

 

 

 

—  

 

 

 

414

 

 

 

—  

 

 

 

8,414

 

 

— 

 

130

 

774

 

— 

 

904

Kurt J. Hilzinger

 

 

40,000

 

 

 

—  

 

 

 

3,168

 

 

 

—  

 

 

 

43,168

 

 

40,000

 

3

 

3,168

 

43,171

David A. Jones, Jr.

 

 

40,000

 

 

 

—  

 

 

 

1,188

 

 

 

—  

 

 

 

41,188

 

 

40,000

 

3,645

 

762

 

972

 

45,379

Karen W. Katz

 

 

18,750

 

 

 

—  

 

 

 

1,188

 

 

 

—  

 

 

 

19,938

 

 

22,500

 

11

 

2,286

 

1,628

 

26,425

Marcy S. Klevorn

 

 

20,000

 

 

 

—  

 

 

 

990

 

 

 

—  

 

 

 

20,990

 

 

25,500

 

123

 

1,188

 

— 

 

26,811

William J. McDonald

 

 

40,000

 

 

 

—  

 

 

 

2,286

 

 

 

—  

 

 

 

42,286

 

 

40,000

 

19

 

2,286

 

3,725

 

46,030

Jorge S. Mesquita

 

 

—  

 

 

 

—  

 

 

 

990

 

 

 

—  

 

 

 

990

 

 

40,000

 

268

 

1,188

 

— 

 

41,456

James J. O’Brien

 

 

40,000

 

 

 

—  

 

 

 

2,286

 

 

 

—  

 

 

 

42,286

 

 

40,000

 

459

 

762

 

— 

 

41,221

Marissa T. Peterson

 

 

—  

 

 

 

—  

 

 

 

774

 

 

 

—  

 

 

 

774

 

Brad D. Smith

 

— 

 

167

 

774

 

— 

 

941

 

Director Compensation  2022 2024 Proxy Statement | Humana

 

     43


Stock Ownership Information

 

 

Delinquent Section 16(a) Reports

Section 16(a) of the Securities Exchange Act of 1934, or the Exchange Act, requires our directors and executive officers, and persons who beneficially own more than ten percent of a registered class of our equity securities, to file with the SEC and the NYSE reports of ownership and reports of changes in ownership of our common stock and our other equity securities. These reports generally are due within two business days of the transaction. Executive officers, directors, and greater than ten percent stockholders are required to furnish us with copies of all the forms they file.

During the year ended December 31, 2023, based solely on a review of the reports furnished to the Company, or written representations by persons subject to Section 16(a), the Company believes that all executive officers, directors, and greater than ten percent beneficial owners of our common stock complied with Section 16(a) filing requirements applicable to us.

Security Ownership of Certain Beneficial Owners of Company Common Stock

We know of no person or entity that may be deemed to own beneficially more than 5% of our outstanding common stock except for:

 

   Number of Shares   

Percent of Class  

Outstanding(1)

BlackRock, Inc.

55 East 52nd Street50 Hudson Yards

New York, New York 10055

10001

   

11,254,35511,248,135 Shares

8.7%(2)

FMR LLC

245 Summer Street

Boston, MA 02210

   

8,815,438 Shares

6.8%9.2%(3)(2)

T. Rowe Price Associates, Inc.

100 E. Pratt Street

Baltimore, MD 21202

  

10,508,002 Shares

8.2%(4)

The Vanguard Group

100 Vanguard Boulevard

Malvern, Pennsylvania 19355

   

10,008,32211,171,000 Shares

 7.8%9.1%(5)(3)

 

(1)

The percentage of ownership is based on 128,801,984122,224,220 Shares of our common stock outstanding as of December 31, 2021.2023.

(2)

Based upon a Schedule 13G filed with the SEC for the period ended December 31, 2021,2023, BlackRock, Inc. reports that through various subsidiaries, it has sole power to vote 9,808,23510,262,713 Shares and has sole dispositive power over 11,254,35511,248,135 Shares.

(3)

Based upon a Schedule 13G filed with the SEC for the period ended December 31, 2021, FMR LLC reports that through various subsidiaries, it has sole power to vote 892,700 Shares and has sole dispositive power over 8,815,438 Shares.

(4)

Based upon a Schedule 13G filed with the SEC for the period ended December 31, 2021, T. Rowe Price Associates, Inc. reports that through various subsidiaries, it has sole power to vote 3,402,524 Shares and has sole dispositive power over 10,508,002 Shares.

(5)

Based upon a Schedule 13G filed with the SEC for the period ended December 31, 2021,29, 2023, The Vanguard Group reports that through various subsidiaries, it has shared power to vote 203,596160,444 Shares, sole dispositive power over 9,488,70510,643,005 Shares, and shared dispositive power over 519,617527,995 Shares.

 

44  

Humana | 20222024 Proxy Statement Stock Ownership Information

 


Security Ownership of Directors and Executive Officers

The following table shows stock ownership as of January 15, 2022,2024, by (i) each of our director nominees; (ii) Bruce D. Broussard, our President and Chief Executive Officer; (iii) Susan M. Diamond, our Chief Financial Officer; (iv) Brian A. Kane, our former Chief Financial Officer; (v) each of our three other highest compensated executive officers serving as of December 31, 2021,2023, (we collectively refer to these officers in this proxy statement as our Named Executive Officers, or NEOs); and (vi)(v) by all our director nominees and executive officers as a group, including those named above.

 

    
  

Company Common    

Stock Beneficially    

Owned as of    

January 15, 2022    

(1)(2)    

  Percent
of
Class as of
December 31, 2021
(3)
 Company Common
Stock Beneficially
Owned as of
January 15, 2024
(1)(2)
Company Common
Stock Beneficially
Owned as of
January 15, 2024
(1)(2)

Percent

of

Class as of
 December 31, 2023
(3)

Percent

of

Class as of
 December 31, 2023
(3)

    

Raquel C. Bono, M.D.

       397   

 

 397

 

 

    

Frank A. D’Amelio

  20,634   

 

 20,634

 

 

    

David T. Feinberg, M.D.

          0   

 

 441

 

 

    

Wayne A.I. Frederick, M.D.

       440   

 

 440

 

 

    

John W. Garratt

       843   

 

 1,255

 

 

    

Kurt J. Hilzinger

  19,448   

 

 19,448

 

 

    

David A. Jones, Jr.

  69,128   

 

  

Karen W. Katz

       590   

 

 590

 

 

    

Marcy S. Klevorn

       436   

 

 436

 

 

    

William J. McDonald

    2,276   

 

  

Jorge S. Mesquita

         436   

 

 1,653

 

 

    

James J. O’Brien

      1,002   

 

Brad D. Smith

 386

 

    

Bruce D. Broussard

  148,628   

 

 160,822

 

 

    

Susan M. Diamond(4)

    11,069   

 

Susan M. Diamond

 18,630

 

    

Brian A. Kane(4)

    26,339   

 

Sanjay K. Shetty, M.D.

 169

 

    

T. Alan Wheatley

    31,505   

 

Joseph C. Ventura

 20,812

 

    

Timothy S. Huval

    20,176   

 

George Renaudin II

 4,084

 

    

William K. Fleming

    25,291   

 

  

All directors and executive officers as a group (24 in number, including those named above)

  495,990   0.39% 

All directors and executive officers as a group (21 in number, including those named above)

(1)

Beneficial ownership of Shares, for purposes of this proxy statement, includes Shares as to which a person has or shares voting and/or investment power. Therefore, any restricted stock for which a person has voting power and all share equivalents in the Humana Retirement Savings Plan are included. These footnotes describe whenever an individual Shares voting and/or investment power over the Shares beneficially owned by them.

The number of Shares listed:

 

 (a)

Includes certain Share equivalents held for the benefit of the individuals in the Humana Retirement Savings Plan as of December 31, 2021,2023, over which the employee participant has voting power and investment power. As of December 31, 2021,2023, our Named Executive Officers held 3,2142,886 of such Share equivalents in the Humana Retirement Savings Plan, while all of our executive officers as a group (12(10 in number, including our NEOs) held 4,3333,006 of such Share equivalents.

 (b)

Does not include the initial stock retainer of 441 restricted stock units granted to Dr. Feinberg on his March 1, 2022 election date pursuant to our 2022 director compensation program. The restricted stock units represent approximately $190,000 and were determined using the grant date fair market value of our common stock ($430.62). The restricted stock units are expected to vest in full on March 1, 2023, unless service on the Board is less than one year in which case the restricted stock units will be forfeited in their entirety.

Stock Ownership Information  2022 Proxy Statement  |  Humana

45


(c)

Includes unvested restricted stock unit awards of our directors and executive officers which are scheduled to vest within 60 days after January 15, 2022,2024, as follows (performance-based restricted stock units are shown at the maximum level):

 

 

Marcy S. Klevorn

436

Jorge S. Mesquita

436
 

Bruce D. Broussard

   36,53018,072 
 

Susan M. Diamond

   1,6882,687 
 

Brian A. KaneJoseph C. Ventura

   10,5542,731 
 

T. Alan WheatleyGeorge Renaudin II

   7,144884 

Timothy S. Huval

5,520

William K. Fleming

6,494
 

All directors and executive officers as a group (24(21 in number, including our NEOs)

   88,28435,629 

 

Stock Ownership Information 2024 Proxy Statement | Humana

(d)45


(c)

Includes Shares which may be acquired by these individuals through the exercise of options, which are exercisable currently or within 60 days after January 15, 20222024 under either the 2011 Stock Incentive Plan or the 2019 Amended and Restated Stock Incentive Plan. As of January 15, 2022,2024, none of our non-employee directors held exercisable options. Exercisable options held by our NEOs and other executive officers as of January 15, 2022,2024, or exercisable within 60 days thereof, were as follows:

 

  

Bruce D. Broussard

   50,84368,505 
 

Susan M. Diamond

   4,37310,014 
 

Brian A. KaneJoseph C. Ventura

   15,40313,262 
 

T. Alan WheatleyGeorge Renaudin II

   16,7251,387 

Timothy S. Huval

7,761

William K. Fleming

13,083
 

All executive officers as a group (12(10 in number, including our NEOs)

   181,948156,550 

 

 (e)(d)

Does not include stock awards to certain of our directors that have been deferred pursuant to our Deferred Compensation Plan for Non-Employee Directors. These deferred stock awards include the initial award of 7,500 restricted stock units to each of Messrs. McDonald and O’Brien when first elected as a director, which by its terms must be held until the recipient is no longer serving on our Board of Directors. As of January 15, 2022,2024, the Shares deferred were as follows (includes accrued dividend equivalent units on deferred Shares and deferred cash that was invested in the Humana Common Stock Fund):

 

  

Raquel C. Bono, M.D.

   4051,210 
 

Frank A. D’Amelio

   26,84027,632 
 

David T. Feinberg, M.D.

   0524 
 

Wayne A.I. Frederick, M.D.

   4051,210 
 

John W. Garratt

   0382 
 

Kurt J. Hilzinger

   34,96437,825 

David A. Jones, Jr.

5,987
 

Karen W. Katz

   1,4012,200 
 

Marcy S. Klevorn

   0800 
 

William J. McDonaldBrad D. Smith

   38,286

Jorge S. Mesquita

0

James J. O’Brien

29,662645 

 

 (f)(e)

Does not include the January 3, 20222, 2024 annual stock retainer of 412430 restricted stock units granted to each of our directors (other than Mr. Broussard) pursuant to our 20222023 director compensation program, which restricted stock units are expected to vest in full on December 31, 2022.2024. The restricted stock units represent approximately $190,000$200,000 and were determined using the grant date fair market value of our common stock $461.09.$464.85.

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(2)

As of March 1, 2022,2024, no Shares are pledged by any of our executive officers or directors in accordance with our policy prohibiting pledging or hedging transactions.

(3)

Based on 128,801,984122,224,220 Shares outstanding as of December 31, 2021.2023. Unless indicated, ownership is less than 1% of the class.

(4)

Mr. Kane served as Chief Financial Officer of the Company until his transition to a strategic advisor role on June 1, 2021. At such time, Ms. Diamond was appointed to serve as Interim Chief Financial Officer and was formally elected as the Company’s Chief Financial Officer effective on June 28, 2021.

 

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Compensation Discussion and Analysis

 

This Compensation Discussion and Analysis (CD&A) presents in detail our executive compensation policies and practices, describing each element of compensation and the decision-making process by our Organization & Compensation Committee (“Committee”) that supports it. We encourage you to read this CD&A in conjunction with the compensation tables that follow for additional context to the Committee’s decisions with respect to the 20212023 compensation of our Named Executive Officers (“NEOs”), as listed below.

 

20212023 Named Executive

Officers

 

 

Bruce D. Broussard

President and Chief Executive Officer

 

 

Susan M. Diamond

Chief Financial Officer

 

 

Brian A. KaneSanjay K. Shetty, M.D.

Former Chief Financial Officer(1)President, CenterWell

 

 

T. Alan WheatleyJoseph C. Ventura

Segment President, RetailChief Legal Officer

 

 

Timothy S. HuvalGeorge Renaudin II

Chief Administrative Officer

William K. Fleming, PharmD

Segment President, Pharmacy SolutionsMedicare & Chief Corporate Affairs OfficerMedicaid

(1)

Mr. Kane served as Chief Financial Officer of the Company until his transition to a strategic advisor role on June 1, 2021, the date that he ceased to be an executive officer of the Company.

CD&A Table of Contents

 

LOGO

  Executive Summary     4948
  20212023 Business and Financial Performance HighlightsResuls     4948
  Compensation Program Highlights     5049
  
    LOGO      

LOGO

Compensation Framework
  Compensation Framework   5150
  Compensation Program Design Principles     5150
  Key Compensation Program Governance Components     5150
  Overview of Compensation Elements     5251
  Inputs Into Compensation Decisions     5251
  Independent Compensation Consultant     5352
  Stockholder Engagement and Say-on-Pay     5352
  Peer Group     5655

LOGO

  Plan Design and Award Decisions     5756
  Base Salary     5756
  Short-Term Incentives     5756
  

Associate Incentive Plan

     5756
  

A Closer Look at AIP Strategic Measures

  59
  

20212023 AIP Performance Results

  60
  Long-Term Incentives  60
Design of Long-Term Incentives Granted in 202361
Results of Our Performance-Based Restricted Stock Units Granted in 202162
  

Performance of our 2019-2021 Performance-Based Restricted Stock UnitsDesign Framework

  62
  

Alignment of Strategic Measures

63

Performance Achievement Results

63
Other Benefits and Perquisites     6364

LOGO

  Compensation Risk Management, Policies and Practices     6465
  Clawback Policy     6465
  Hedging and Pledging Policy     6465
  Stock Ownership Guidelines     6465
  

Insider Trading Policy

  

   64

65

 

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Executive Summary

2021 was another extraordinary and challenging year for our Company, members, associates, and stakeholders as the COVID-19 pandemic and the emergence of the Delta and Omicron variants continued to drive an uncertain environment for the healthcare system. The widespread adoption of vaccines allowed the healthcare system to remain open and our members resume routine interactions with their healthcare providers, while unanticipated surges in the pandemic led to increased hospitalizations, particularly among the unvaccinated. Nonetheless, our core operations remained strong as we maintained focus on ensuring our members and patients received the right care at the right time, providing the highest quality health care experience, advancing our strategy and delivering on our commitments to ESG.

To that end, we were pleased to be recognized by CMS for having 97% of our members in 2021 in 4-Star or higher contracts for 2022, and increasing the number of our contracts that received a 5-Star rating from 1 contract in 2021 to 4 contracts in 2022, the most in our history. This accomplishment further demonstrates our enterprise-wide focus on quality, clinical outcomes and best-in-class customer service, which has been recognized from notable organizations such as Forrester, J.D. Power and USAA. We also saw an improvement of 930 basis points in our Net Promoter Score this past year, reflecting our ongoing efforts to enhance the customer experience.

The year was also marked by significant progress in our strategy to advance our healthcare services platform. We accelerated the growth of our senior-focused, value-based primary care organization, the largest in the nation, through the opening of fifteen de novo senior-focused centers and the completion of nine strategic acquisitions, which brought an additional forty wholly-owned centers to our portfolio. We also completed the acquisition of Kindred at Home, the largest home health and hospice organization in the nation. Together with our acquisition in the first half of 2021 of One Homecare Solutions (onehome), we continue our efforts to transform home health to a value-based model and capture the meaningful opportunity for home health organizations to engage differently with patients and Medicare Advantage payers to more holistically address patient needs and improve health outcomes and reduce the total cost of care. We are excited about the continued progress of our strategy in both primary care and the home.

We also saw continued growth in our pharmacy business, with our PBM, the fourth largest in the country, processing 515 million 30-day equivalent scripts in 2021, an 8 percent increase year over year. In addition, our pharmacy dispensing business continues to deliver industry leading mail order penetration and we have successfully implemented tools to enhance our e-commerce experience, while expanding our mail order footprint to move us closer to the consumer.

We offer superior quality to our members, have a strong brand, and a long history of expertise in caring for people as they age. Additionally, our clinical focus and suite of Healthcare Services capabilities allows us to take a holistic approach to supporting members, ensuring they receive high quality, proactive and comprehensive care, which improves health outcomes. We will continue leveraging the strength of these core fundamentals to drive meaningful results for our Company and each of our stakeholders.

2021 Financial Performance Highlights

Our 2021 results demonstrate the continued strength of our core operations, and the commitment of the Board and executive management team to achieving strong operating results as we navigated through significant headwinds presented by the continued volatility and uncertainly of the COVID-19 pandemic, which ultimately had a more significant impact than we initially anticipated. Highlights of our fiscal year 2021 financial performance are illustrated below.

LOGO

Compensation Discussion and Analysis  2022 2024 Proxy Statement | Humana

 

     4947


Executive Summary

We are a leading health and well-being company focused on making it easy for people to achieve their best health with clinical excellence through coordinated care. Our strategy integrates care delivery, the member experience, and clinical and consumer insights to encourage engagement, behavior change, proactive clinical outreach and wellness for the millions of people we serve across the country.

Our executive compensation program is designed to attract and retain highly qualified executives and focus, challenge and motivate these leaders by directly linking compensation to the achievement of our financial and strategic goals. The Organization & Compensation Committee believes that this is best accomplished when a significant portion of executive compensation is incentive based over the long-term, which aligns executive pay with stockholder interests, links pay to performance and the execution of enterprise-wide goals and incentivizes retention.

In evaluating 2023 compensation for our executive officers, the Organization & Compensation Committee considered the challenging environment facing the Company as the Medicare Advantage industry navigates a complex and dynamic period of change. The Company takes its commitments seriously, and the Committee was disappointed with our lower than anticipated financial results for 2023, and the expectation that higher medical cost trends will continue to impact our business in 2024. At the same time, the Company achieved strong growth in its Medicare Advantage membership and Medicaid and CenterWell businesses in 2023, continuing to advance its industry leading Medicare Advantage and senior focused value-based care platforms and positioning the Company for success over the long-term.

2023 Business and Financial Performance Results

Reported diluted earnings per common share (EPS) of $20.00 on a Generally Accepted Accounting Principles (GAAP) basis and Adjusted EPS of $26.09.*

Grew our individual Medicare Advantage membership by 843,300 members, representing 18.5% growth over fiscal year 2022, meaningfully higher than industry growth.

Remained the industry-leader in Star Ratings among our publicly traded peers for the sixth consecutive year, with 94% of our Medicare Advantage members enrolled in 4-star and above contracts,*** 61% of members in 4.5 and 5-star contracts, and four of our contracts receiving a 5-star rating.

Advanced the organic growth of our Medicaid business, successfully implementing contracts in Ohio and Louisiana early in 2023 and being recommended to serve beneficiaries in Indiana and Oklahoma as the year progressed, with expected implementation in 2024.

Added 61 net centers (26% growth) and 46,300 new patients (18.7% growth)—across 15 states, including new market entries in Indiana, Tennessee, Mississippi, and Virginia—to our CenterWell Primary Care platform through a combination of de novo builds and strategic M&A.

Increased the number of Humana Medicare Advantage members covered by a value-based home care model to 843,500, growth of 82,900 members (10.9% growth) year-over-year.

Returned to stockholders 

Adjusted Return on Invested Capital (Adjusted ROIC) reflecting

 

 Stock Total Return Performance

 

$2.0 Billion 

 

through dividends and stock

repurchases**

 

 

 

15.35% 

 

average over the past 3-year period

(2021, 2022 and 2023)

 

 

LOGO

 

Delivered exceptional Star Ratings

for our MA members with

 

 

 

Cumulative Total Stockholder
Return (TSR) reflecting

 

94%  63.7% 

of our Medicare Advantage

members enrolled in 4-star and

above contracts***

 

average over the past 5-year period

(2019, 2020, 2021, 2022 and 2023)

 

   

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Humana | 2024 Proxy Statement Compensation Discussion and Analysis


LOGO

Compensation Program Highlights

The Committee is dedicated to maintaining a robust, structured and balanced compensation program designed to motivate and reward the Company’s executives to drive Humana’s performance. Our maturing compensation program is a testament to the Committee’s thoughtful consideration and progressive approach to evolve and align with market best practices and stockholders’ interests. The chart below identifies certain elements of our compensation program.

 

 

PROGRAM SUMMARY

 

 

Incentive Plans. Our executive compensation program includes both short-term incentive (STI) and long-term incentive (LTI) plans. These plans are designed with the goal of balancing short-term decisions with creating long-term stockholder value; we aim to drive focus on achieving key short-term enablers that will lead to successful outcomes on long-term strategic initiatives.


 

Equity Awards. We offer our executive officers a combination of incentive stock options (ISO), non-qualified stock options (NQ) and restricted stock units (RSU) that are both time-based and performance-based restricted stock units (RSU)(PSU), to align their interests with the creation of long-term stockholder value.

 

Vesting Periods. We offer time-based equity awards that vest annually in one-third increments over a three-year period, and performance-based equity awards that vest on the third anniversary of the grant date based on the achieved performance results against preset performance targets.

 

Performance Measures. For our executive officers, at least 55%50% of their LTI awards are performance-based. Performance is measured against the Company’s three-year aggregated return on invested capital (ROIC), and strategic performance measures, with a total stockholdershareholder return modifier (rTSR) that measures our performance relative to a PSU Comparator Group over the same period.

 

Stock Ownership Guidelines. We require our CEO, executive officers and senior vice presidents to maintain minimum stock ownership levels (7x, 3x and 1x of base salary, respectively). These requirements illustrate our belief in aligning the interests of our executives with the interests of our stockholders.

 

Market-based Compensation. We perform regular market compensation analysis to maintain competitiveness of our executive compensation program.

 

Peer Group. We leverage a robust peer group comprised of companies in the managed care industry, health care services and facilities industry, and financial and other insurance-related industries to benchmark and assess our compensation programs and practices.

 

Change in Control and Executive Severance Policies. We have a Severance Policy and Change in Control Policy, applicable to the CEO and other executive officers with restrictive covenants that align with the applicable severance period for any benefits.

 

Clawback Policy. We maintain a clawback policy that includes both complies with recently adopted regulatory requirements and continues to apply to allincentive-based compensation.

compensation in connection with improper conduct. Our current policy was adopted by the Board of Directors effective October 2, 2023 (replacing our prior policy in its entirety).

 

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49


Compensation Framework

Compensation Program Design Principles

Our executive compensation program is designed to attract, retain, focus and motivate leaders to achieve strategic milestones and performance objectives that advance and grow our integrated care-delivery model. We design our executive compensation programs to challenge participants as well as reward them for superior performance for our Company and our stockholders. Our compensation program is predicated on three interconnected design principles:

 

 

LOGOLOGO

Key Compensation Program Governance Components

Our robust and structured compensation program reflects the Committee’s belief that strong corporate governance is imperative for prudent compensation decision-making. Below are key governance elements of our compensation programs. We also identify certain common pay practices that we do not follow because they do not align with the strict standard of governance that we apply to our compensation programs.

 

  

WHAT WE DO

   

 

 WHAT WE DON’T DO
 Design incentive plans with the majority of executive pay at risk   

×

 No stock option repricing without stockholder approval
 Maintain aClawback Policythat includesboth complies with recently adopted regulatory requirements and continues to apply to all incentive-based compensation in connection with improper conduct   

×

 No single trigger vesting of equity or cash severance payments upon change in control
 Include double-trigger provisionsunder our Change in Control Policy and equity agreements applicable to our executive officers   

×

 No hedging or pledging of Humana securities by associates (including executive officers and directors)
 Require minimum stock ownership levels for senior leadership   

×

 Notax gross-ups for our NEOs or other executive officers
 Maintain commitment to stockholder engagement   

×

 Noexcessive perquisites for senior leaders; all perquisites require specific business rationale
 Conductanannual compensation risk assessment   

×

 No positive discretion for incentive-based awards
 Utilize an independent compensation consultant hired and overseen by the Committee   

×

 No dividends or dividend equivalents on unearned PSUs or RSUs
    

×

 No employment contracts with CEO, NEOs or other executive officers and senior leaders
         

 

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Overview of Compensation Elements

The material components of our executive compensation programs are: (i) base salary; (ii) short-term cash incentives; and (iii) long-term equity incentives. We believe that having a combination of pay elements motivates and challenges our executives to achieve positive results for our Company and our stockholders. Each element of compensation is summarized as follows:below.

 

Fixed

Compensation

  Base Salary  Cash  

  Market competitive fixed compensation, reflecting executive’s scope of responsibility

 

  Annually reviewed for market alignment, with adjustments as appropriate

At Risk Compensation  Short-Term

Incentives
  Cash  

 

  Cash-based incentive compensation to reward performance for achievement of short-term business objectives

 

  Measures aim to optimize the level of year-over-year profitability in the short-term while contributing to the long-term success of the organization

  Long-Term

Incentives
  Humana Equity  

 

  Promotes retention of our executive talent

 

  Motivates executives to optimize the long-term success of the organization

 

  Mitigates excessive risk taking by encouraging executives to act in the long-term interest of the organization

 

 

LOGOLOGO

Inputs Into Compensation Decisions

For 2021,2023, the Committee received input from a number of sources and reference points to guide its design of the Company’s executive compensation programs and individual pay decisions. These various perspectives allow the Committee to have visibility into our peer companies’ practices, investor viewpoints, changes in external market practices and each executive’s individual performance, as part of its review of compensation. The Committee regularly reviews input and data received from its independent compensation consultant, our stockholders, external market practice surveys and individual performance assessments to make informed compensation decisions for our NEOs. In addition, the Committee regularly reviews tally sheet information that provides a comprehensive look at total compensation for each of our NEO’s. The chartfigure below further describes the primary sources contributing to the Committee’s decision-making process.

 

Compensation Discussion and Analysis 2024 Proxy Statement | Humana

 

52   

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51


LOGO


LOGO

Independent Compensation Consultant

For 2021,2023, the independent compensation consultant for the Committee was Farient Advisors, LLC (Farient). A representative of Farient attended all of the regularly scheduled Committee meetings in 2021,2023, including, when invited, executive sessions. In accordance with the Committee’s Charter, the Committee has the sole authority to determine the compensation for, and to terminate the services of, the independent compensation consultant.

The Committee considered certain factors to determine whether Farient’s service as a compensation consultant raised a conflict of interest, including, among other things:

 

Whether the firm provided other services to the Company;

Whether the firm provided other services to the Company;

 

The amount of fees received by the firm from the Company, as a percentage of such firm’s total revenue;

The amount of fees received by the firm from the Company, as a percentage of such firm’s total revenue;

 

The firm’s policies and procedures that are designed to prevent conflicts of interest;

The firm’s policies and procedures that are designed to prevent conflicts of interest;

 

Whether the firm’s representatives providing services to the Committee have any business or personal relationship with a member of the Committee;

Whether the firm’s representatives providing services to the Committee have any business or personal relationship with a member of the Committee;

 

Whether the firm’s representatives providing services to the Committee own Company stock; and

Whether the firm’s representatives providing services to the Committee own Company stock; and

 

Whether the firm’s representatives providing services to the Committee, or the firm itself, have any business or personal relationship with any of our executive officers.

Whether the firm’s representatives providing services to the Committee, or the firm itself, have any business or personal relationship with any of our executive officers.

After considering all of the above factors, the Committee determined that the service provided to the Committee as an independent compensation consultant by Farient in 20212023 did not raise any conflict of interest.

Stockholder Engagement and Say-on-Pay

The Board, together with its committees and management team, routinely reviews and responds to the feedback received from our stockholders – through formal stockholder engagements, stockholder voting results and routine communication during the year – creating a feedback loop of transparency into our compensation and governance practices. The continuous dialog supplements the Board’s customary review of our governance and compensation programs, policies and/or practices as it considers areas for enhancement or improvement.

The Board views these engagements as an opportunity to gain insight and perspective on issues that matter most to our stockholders and believes that the most constructive way to achieve meaningful dialogue is to connect with them directly. Accordingly, the Company offers attendance by Board and executive management team members throughout the engagement process. Our Board respects the views voiced by our stockholders and understands the importance of regular engagement as priority issues evolve over time. Feedback received during dialogue with stockholders has, in some cases, led to the reaffirmation of, or enhancements to, certain of our corporate governance, ESG, and executive compensation practices.

 

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53


In addition to the above interactions, the Company routinely meets with stockholders, analystsprospective investors, and prospective investorsanalysts throughout the year during industry conferences and other events. The Company’s meeting schedule, presentations to investors and webcast replays are available via the Investor Relations section on our website. From www.humana.com, click on “Investor Relations”“More Humana” then click on “For Investors” and then click on the “Calendar of Events” tab. The illustration below further details our stockholder engagement and feedback consideration methods.

 

 

LOGOLOGO

 

  

Fall 20212023 Outreach

 

As we’ve done in the past, in the fall of 20212023 we solicited engagements with thirty of our largest stockholders, representing approximately 63% of our outstanding Shares as of June 30, 2021,2023, and invited them to set the agenda based on their areas of interest. Our stockholder discussions includedencompassed a variety of topics including: corporate governance, strategy, executive compensation, CEO succession, board refreshment, and environmental and social issues and the Company’s continued response to the ongoing COVID-19 pandemic.issues.

  30

Invited Stockholders

Members of the Board and the executive management team made themselves available to attend all meetings upon request. In addition, the Chairman of the BoardSubsequently, Kurt J. Hilzinger, David T. Feinberg, M.D., Karen W. Katz, and Brad D. Smith each participated during these meetings at the request of certain of our stockholders.

  63%

Outstanding Stock Represented

EightTwelve engagements were held in response to our outreach, representing approximately 36%40% of our outstanding Shares as of June 30, 2021.2023. As a result of these engagements, we received valuable feedback regarding the Company’s current practices. The feedback was overwhelmingly positive regarding our programs and governance, as described in greater detail below. We believe the lower level of engagement interest fromThese engagements affirmed our belief that stockholders represents satisfactionare satisfied with our current programs, and practices, and illustrates the effectiveness of our ongoing communications with stockholders throughout the yearon matters concerning the Company generally orand the Board’s oversight.

  8
12

Engagements Held

The Board believes that having ongoing communication with the Company’s stockholders provides valuable insight to ensure the Board is acting in the best interests of Humana and its stockholders.

 

  36%
40%

Outstanding Stock Represented

 

 

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53


Stockholder Engagement Key Discussion Themes

 

LOGOLOGO LOGOLOGO LOGOLOGO
Corporate Governance, Strategy and CEO
Succession
 LOGO

Corporate Governance & Strategy

Executive Compensation
 

Executive Compensation

Environmental & Social Issues

Continued COVID-19 Response

 

What We Heard During Our 20212023 Stockholder Outreach

•  Stockholders commendedappreciated our continued Board refreshment during 2023, and our disclosure of a formal director skills matrix, while also maintaining their interest in the Board’s 2020-2021overall composition, process for director refreshment, and appreciated the currentrepresentation of diversity and skills represented, while noting a continued focus on Board tenure. Given the Board’s current composition mix, stockholders were also interested in the Company’s director onboarding practices, boardroom dialogue and interactions with management.skills.

 

•  Stockholders were interested in our Board’s process for managementCEO succession planning including the transition ofand decision-making in connection with the Company’s CFO roleCEO transition plan announced in 2021.October 2023. They also expressed interest in understanding the Board’s process for executive management team succession and retention strategies.

 

•  Stockholders inquired about our Board’s policycertain governance processes including shareholder rights and oversight and controls related to cybersecurity. They also desired the Company’s perspective on political giving inregulatory scrutiny concerning Pharmacy Benefit Managers (PBMs), continued monitoring of potential impacts to the current political climate.Company arising from the Inflation Reduction Act and CMS Risk Adjustment Data Validation (RADV) audits.

 

•  Stockholders appreciatedexpressed continued interest in understanding the process for compensation plan design, rigor placed on target setting, the Company’s enhanced disclosurecontemplation of compensation metrics and indicated the importance of continued transparency in this area. Stockholders also expressed interest in emerging compensation trends, including the potential inclusion of future ESG metrics within compensation programs,additional performance measures, and sought the Company’s feedback on these trends.additional disclosure regarding LTI plan design.

 

•  Stockholders commendedprovided positive feedback on the Company’s enhanced ESG practicesintegrated Impact Report connecting Environmental, Social and reporting, including the reconstituted governance structure, as well as its expanded ESG disclosures using frameworks established by the Sustainability Accounting Standards Board (SASB) and the Task Force on Climate-Related Financial Disclosures (TCFD). Stockholders also suggested opportunities for continued advancement withinGovernance (ESG) issues to the Company’s ESG disclosures including: additional quantitativestrategy, highlighting, highlighting key performance metrics ambitious environmental targets, transparency in supplier oversight practices and statistics related to employee development and leadership.improved disclosure transparency.

 

•  Stockholders remained interested in business impacts resulting from COVID-19 with particularwere overwhelming supportive of the Company’s development of an environmental science-based target (SBT) and expressed interest in steps taken to mitigate effects to stakeholders (members, providers, associates, investors) as the pandemic continues, including workforce re-entry plans, the Company’s COVID-19 vaccine policy,progress toward SBT validation and Company culturefuture discussion of underlying Scopes 1, 2 and 3 components.

•  Stockholders inquired about the Company’s associate population, noting the year-over-year decline in a continued remote work environment. The Company received positive feedback on maintaining world-class engagement scores in 2021.

Black, Indigenous, and People of Color (BIPOC) representation, and the Company’s strategies to monitor and mitigate these trends over time.

 

How We Responded to What We Heard

Our Board is firmly committed to engagement with our stockholders and having candid dialogue. The Board welcomes feedback and believes these practices are in the best interest of our Company and our stockholders. Stockholders and other interested parties may contact our Board at any time, as instructed in the section titled “Communication with Directors” in this proxy statement. Our responses to certain stockholder feedback received during the 20212023 engagement period are outlined below.

 

•  ReaffirmedUpheld commitment to ongoing reviews performed by the Board in consideration of composition, tenurediversity, skills and refreshment. Incorporated certain demographic information of each director within their biographies to enhance transparency.

 

•  ConfirmedDescribed the Board’s oversight of Humana’s Political Action Committee (PAC)role in the CEO succession planning, search, and decision-making processes. Explained the Board’s involvement in succession planning for the executive management team and the PAC’s commitment to supporting persons and/or organizations who share our belief that coordinated health care coverage brings quality, choice, access and affordability to consumers.process for executive compensation decisions.

 

•  ReaffirmedIncorporated and disclosed certain of the Investor Day targets within the 2023 LTI compensation plan design as previously committed, reinforced our commitment to determine achievement undercontinued evaluation of potential metrics that are most appropriate for the program, and enhanced disclosure of strategic measures associated with our compensation plans based on established compensation metrics and the terms of the plans and continuing to consider emerging trends in the design of our compensation programs.PSUs.

 

•  Developed an integrated ESG report (Humana’s Impact Report) aligned toIssued a press release announcing validation of our SBT and confirmed that the Company’s strategy2023 Impact Report will contain discussion of our path toward achievement and overall will maintain robust narrative of material topics, with corresponding metrics, that contains quantitative and qualitative metrics and applies reporting standards established by prominent ESG frameworks. The Company is also committedconnect to considering additional opportunities for enhancement to its ESG program, including establishing ambitious environmental targets and evaluating new areas of disclosure.our Company’s enterprise business strategy.

 

•  Maintained our commitmentContinued to supportaddress certain mechanisms of comprehensive oversight by the healthBoard, as a whole and well-beingthrough its Committees, of our members, associatesmaterial risks facing the Company, and confirmed that the communities we serve as the COVID-19 pandemic persists.approach includes attention to associate engagement and ESG matters.

 

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55


Say-on-Pay Support

Our 2021 2023 say-on-pay proposal maintained its typically high level ofstrong approval with 95%91% of our stockholders voting in favor of the Company’s compensation strategy. We believe that the result of our 2021 2023 say-on-pay proposal indicates that stockholders are generally supportive of our executive compensation program, and therefore the Committee made no material changes to the executive compensation program as a result of this vote.

Stockholder Voting Trendvoting trend for the past three years is illustrated below.

 

 

LOGOLOGO

Peer Group

Our peer group is used as a reference point in making compensation decisions, such as developing base salary ranges, developing short-term and long-term incentive award ranges, determining competitiveness of the total compensation package for our NEO’s and comparing our performance in order to validate if our compensation programs are informed by market practices.

The Committee uses the framework below, in consultation with its independent compensation consultant (Farient), to filter and select a broad group of potential peers. This framework yields multiple perspectives that enrich our understanding of competitive executive pay practices while also ensuring that our peer group is comprised of companies with whom we may compete for talent and whose revenues, market capitalization, and business focus are similar to our own.

 

 

LOGOLOGO

For 2021 compensation decisions, based on its review alongThe peer group is reviewed at least annually and includes an assessment of current peers as well as potential peers in the context of industry and business model criteria, revenue size reflective of our revenue growth, and M&A activity that could impact the size of business mx of our current peers. In consideration of internal analysis and discussions with advice from its independent compensation consultant,Farient regarding the Company’s business strategy, size and talent pool, the Committee determined to modify the peer group by (i) removing The Travelers Companies, Inc. and (ii) adding Molina Healthcare, and approved the following peer group (the “Peer Group”): for 2023 compensation decisions:

 

Managed Care Peers

Healthcare Services &

Facilities Peers

   

Healthcare Services &

Facilities

Financial & Insurance

Peers

   Anthem, Inc.

   AmerisourceBergen Corporation

   Aflac, Inc.

   Centene Corporation

  

   Cencora

 

   Aflac, Inc.

   CVS Health Corp

   Cardinal Health, Inc.

  

   Allstate Corporation

   Cigna Corporation   Elevance Health, Inc.

   

   DaVita Inc.

  

   MetLife, Inc.

   CVS Health Corp   Molina Healthcare

   

   HCA Healthcare, Inc.

  

   Progressive Corporation

   UnitedHealth   The Cigna Group Inc.

   

   Laboratory Corporation of America Holdings, Inc.

  

   Prudential Financial, Inc.

   UnitedHealth Group Inc.

   

   McKesson Corp

 
 

   The Travelers Companies, Inc.

   Walgreens Boots Alliance, Inc.

  

Humana’s 2021 Peer Group Financial Comparison

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Compensation Discussion and Analysis 2024 Proxy Statement | Humana

   

Humana  |  2022 Proxy Statement  Compensation Discussion and Analysis

55


Humana’s 2024 Peer Group Financial Comparison


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Plan Design and Award Decisions

Base Salary

On an annual basis, the Committee, in consultation with its independent compensation consultant, reviews the market data and current base salaries for our executives, considering adjustments as deemed appropriate. Salary increases, if any, must receive advance approval from the Committee. WhileDuring its review, the Committee approved no increases in 2020, the 2021 evaluation revealeddetermined that base salary increases were necessary for certain of our NEOsexecutives in 2023 in order to maintain competitive market pay levels. In addition to market data,pay analysis, the 20212023 determinations took into accountconsidered demonstration of enterprise value along with certain expansions of responsibilities. The table below represents base salaries for our CEO and other NEOs as of March 1, 2021,2023, compared to MarchJuly 1, 2020.2022.

 

  

Named Executive Officer

2021 Base Salary

2020 Base Salary

  

Bruce D. Broussard

$

1,349,500

$

1,349,465

  

Susan M. Diamond(1)

$

750,000

$

525,000

  

Brian A. Kane

$

765,000

$

750,000

  

T. Alan Wheatley

$

665,000

$

625,000

  

Timothy S. Huval

$

663,000

$

650,000

  

William K. Fleming

$

560,000

$

550,000

  

Named Executive Officer

  

2023 Base Salary

   

2022 Base Salary

 
  

Bruce D. Broussard

  

$

1,500,000

 

  

$

1,349,500

 

  

Susan M. Diamond

  

$

800,000

 

  

$

750,000

 

  

Sanjay K. Shetty, M.D.1

  

$

675,000

 

  

 

— 

 

  

Joseph C. Ventura

  

$

690,000

 

  

$

630,000

 

  

George Renaudin II 2

  

$

675,000

 

  

 

— 

 

(1)

Effective on July 4, 2021 Ms. Diamond received a base salary increase from $560,000 to $750,000Dr. Shetty joined the Company in connection with her position change to Chief Financial Officer.March 2023.

(2)

Mr. Renaudin joined the Company’s management team in February 2023.

Short-Term Incentives

Our STIenterprise short-term incentive (STI) is administered through the Associate Incentive Plan (AIP), a discretionary, annual cash-based incentive plan. The goal of our plan is to recognize and reward all of our full-time and part-timeparticipating associates, including our executive officers, for their contributions to the Company’s overall performance, while also uniting associates around a common purpose for the year.

Associate Incentive Plan

The AIP plan year is effective January 1 through December 31 of each fiscal year. Associates who participate in other Company incentive plans, such as Sales Incentive/Commission Plans and Targeted Incentive Plans, are not dually eligible to participate in the AIP. Associates may not participate in more than one incentive plan. For our executive officers, the AIP is administered through the Executive Incentive Compensation Plan, as filed with the SEC on annual and quarterly reports on Form 10-K and Form 10-Q, respectively, and can be accessed on our website. From the www.humana.com website, click on “Investor Relations,“More Humana,” then click on “For Investors,” then click on “SEC Filings and Financial Reports,” and then click on “SEC Filings.”

Each associate’s

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Humana | 2024 Proxy Statement Compensation Discussion and Analysis


AIP payout is calculated based on Eligible EarningsAnnual Base Salary (or Annualized Base Salary for hourly associates) during the AIP Performance Period, each as defined under the AIP Plan Document. Eligible EarningsAnnual Base Salary under AIP excludes salaryany unpaid leave or wages classified as commissions, incentive pay, bonuses, rewards, long-term disability, overtime and shift differential compensation.is pro-rated for the number of days eligible during the plan year. Further, in the event of a pay change during the plan year, the Annual Base Salary is pro-rated for the number of days at each base salary, which will result in a blended base salary. Refer to section entitled 20212023 AIP Performance Results” for discussion of AIP payout of our Named Executive Officers.

On an annual basis the Committee, in consultation with its independent compensation consultant, reviews and approves the AIP as outlinedillustrated below:

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Annual Committee AIP Approval Process

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LOGO

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Approve Performance

Measures

Approve Individual

Targets

Approve Performance

Results

•  Performance measures and goals are set by the Committee during the first quarter of the performance year, aligning to the Company’s overall business strategy, segment operations and established financial targets.

•  The Committee reviews and approves individual targets, compared to market, based on the executive’s scope of operations.

•  The Committee certifies the Company’s performance results during the first quarter following the performance period.

•  Results are evaluated against the approved measures and goals.

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The Committee selected the following performance and strategic measures for the 20212023 AIP, aligning our executives to the key financial and operational objectives of our overall strategy:

 

Adjusted Earnings Per Share (EPS) 50% Weighting 

   Bottom-line measure of our organization’s profitability and is a common measure tracked by our stockholders.

 

   The 20212023 target represents a 16.2%an 14% year-over-year target increase. (Adjusted EPS)

Strategic Measures
Net Promotor Score (NPSr) 15% Weighting 

   Strategic initiatives that will improve relationships with our providers, improve member health and position the organization for long-term sustainable growth.

   Continued focus on transformation efforts specific to key short-term enablers that support long-term strategic outcomes: Integration of enterprise platforms, Customer Centric Operating Model and value-based health ecosystem

   Refer to “A Closer Look at AIP Strategic Measures” below for additional details.

Net Promotor Score (NPSt)14% Weighting

   Aligned to our integrated care delivery strategy and focuses on being a consumer-centric organization that strives for continuous member experience improvement.

 

   The measurement process is reviewed   Reviewed and approved by the Company’s Internal Audit Consulting Group and results are independently validated and certified by a third-party.

 

   Data for this measurement is collected from member surveys, using automated interactive voice response (IVR) technology after an interaction with our call center support team.

 

   The 2021   Cumulative customer experience measure across multiple touchpoints, reflecting a more comprehensive measure of the Customer Experience than any single NPSt measure.

   NPSr target represents a 6.8% increase above 2020 results.6.9% improvement over the 2022 baseline.

Individual Medicare Advantage Membership Growth 14%20% Weighting 

   Measures individual Medicare Advantage (MA) net membership growth during the year.

 

   Key element of our enterprise earnings growth framework, in-line with our goal to grow at or above market rate over time.

   The target is set prior to the beginning of the Annual EnrollmentElection Period (AEP).

Member Retention
Strategic Measures 7%15% Weighting 

   Sustainable membership growth and improving   Set of strategic initiatives that, if achieved, will improve relationships with our providers, improve member health outcomes is dependent on our ability to retain members year-over-year.and position the organization for long-term sustainable growth.

 

   Measures MA   Continued focus on transformation efforts specific to key short-term enablers that support long-term strategic outcomes: Advance our integrated health strategy, sustain leading Stars results reflecting the high quality of care provided to members and MAPD plan membership terminations as of December 31 with metric expressed as a voluntary termination rate (VTR).patients and focusing on enterprise operating leverage to drive productivity gains.

   Refer to “AIP Strategic Measures” below for additional details.

 

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Humana | 20222024 Proxy Statement Compensation Discussion and Analysis

 


In addition to the above performance and strategic measures, the Committee also established a funding gate for our management team, whereby no AIP would be paid unless the Company achieves threshold Adjusted EPS performance. Further, the terms of the plan provide that the performance measures determined by the Committee shall automatically adjust to reflect the impact of certain non-recurring events, including the impacts of merger, acquisition and disposition activity, changes in accounting standards, litigation or regulatory investigations outside of the ordinary course of business, restructuring activity outside of the ordinary course of business, business exit or disposal activities, and any extraordinary, natural disaster, unusual or infrequent event. However, the Committee retains the ability to exercise negative (but not positive) judgment with respect to the payout results regardless of the impact of any automatic adjustments.

Under our AIP, individual performance and contributions are taken into consideration when determining each associate’s final payout. For the 20212023 AIP period, the Committee determined that contributions to the advancement of the Company’s inclusion and diversity efforts would continue to be included in the assessment of the individual performance of our executive officers, and members of senior management levels, with the potential for an individual’s payout to be decreased (but not increased) in connection with the individual’s contributions to these efforts.

A Closer Look at AIP Strategic Measures

The Company has a set of strategic initiatives that, if achieved, will improve member health, improve relationships with our providers and position us for long-term sustainable growth. The Committee believes that having strategic measures embedded within the AIP targets is critical to help drive organizational focus and prioritization in advancing our long-term strategy. The 2021strategy, while also incentivizing our associates to achieve milestones in the short-term. As illustrated below, the 2023 strategic measures directly align to our integrated care approach. We saw encouraging progress in 20212023 related to each strategic measure which has a positive, direct impact on our members.

 

LOGO

LOGO

 

Strategic Purpose        Strategic Purpose    Strategic Purpose

Our goal is to scale enterprise platforms in order to unlock value and enable data driven decision making that creates a competitive advantage and drives superior health outcomes.

The availability of new technologies to gather and share data is changing when, where and how we can deliver care. Digital technology plays a critical role in putting members and physicians at the center of a simplified, personalized healthcare experience. Further expanding our digital platform enables us to develop ground-breaking products and services that enhance the quality of care our members receive.

Oriented around the customer journey the Customer Centric Operating Model (CCOM) works in integrated teams in order to prove the value of the customer back model and lay the groundwork to deploy at scale. This also changes the way work is done to be able to solve member problems with faster to market solutions.

To meet the evolving expectations of consumers, it’s important that we create meaningful healthcare experiences that address the needs and preferences of our members, what we call “customer back.” This requires us to continue developing products and services that bring together a holistic view of a members’ physical, pharmaceutical, social, and behavioral needs. By creating an experience that coordinates touch points between internal and external systems, we will build an integrated, hyper-connected ecosystem that improves the customer experience and health outcomes.

We aim to grow utilization of our proprietary Home and Pharmacy assets in order to improve health outcomes and advance Human Care.

The vision of Home Solutions is to create an improved consumer and provider experience and drive better care outcomes by transforming the home into the center of care delivery. We can drive innovations in the home health clinical model and reduce adverse events for our members. By improving the effectiveness & reach of our home care assets, we can more fully and consistently capture our members’ chronic conditions and close care gaps. And through the launch of our transformative asset-light primary care offering, we can deliver longitudinal, personalized, and convenient value-based primary care in a rapidly scalable way.

Strategic Progress          Strategic Progress    Strategic Progress

  We have made advancements in our strategy to achieve integration of technology and analytics across the enterprise. Our efforts in this area have resulted in improved customer journey engagement scores and have enriched services provided by Humana Care Support, our next generation of customized, integrated and coordinated care management services.

  Our CCOM journey teams have implemented measures that promote cultural change, drive impact and improve target delivery. We’ve honed in on specific areas that generate quantifiable change and deliver positive progress within customer pathways. Customer experience remains a primary indicator for the journey teams as they continue to innovate within the CCOM.

  We are bringing value-based care in the home by leveraging our home care assets and strategic partnerships, such as Heal. We’ve remained focused on supporting efforts toward membership growth in the Heal-Humana sector.

  We are growing membership in our award winning mail-order pharmacy and have invested in measures to yield a continuous increase in consumer satisfaction via NPSt.

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20212023 AIP Performance Results  

In determining the funding rateperformance for our NEOs under the 20212023 AIP, the Committee reviewedbegan by reviewing the Company’s overall financial and operating results, of the Company, evaluating them against the AIP performance rangesmeasures developed by the Committee in February 2021,2023, and noting that the challenges faced bymetrics were not subject to any automatic adjustments under the Company fromterms of the ongoing pandemic, approvingPlan and management was not recommending any exceptions or other positive adjustments to performance under the Executive Incentive Compensation Plan targets. During this review, the Committee considered that while Company had experienced strong individual Medicare Advantage membership growth and maintained its NPSr performance, Adjusted EPS results had finished below the threshold set forth in the AIP as follows:a result of the significant and unanticipated increase in medical costs trends in the Medicare Advantage industry during 2023 which accelerated further late in the year.

 

Measure

  Weighting  

Minimum

(50%)

 

  

Target

(100%)

 

  

Maximum

(200%)

 

  Results  Performance Rate  Performance
Weighting
Under Plan

 

Adjusted EPS

  

50%

  

$19.89

  

$21.50

  

$23.11

  

$22.09

  

136.65%

  

68.3%

 

Net Promoter Score (NPSt)(1)

  

14%

  

50%

  

100%

  

200%

  

200%

  

200%

  

20.9%

 

Membership Growth

  

14%

  

300,000

  

380,000 - 410,000

  

490,000

  

449,220

  

149.03%

  

28.0%

 

Member Retention

  

7%

  

7.5%

  

15%

  

22.5%

  

0%

  

0%

  

0%

 

Strategic Measures

(See “A Closer Look at AIP Strategic Measures”)

  

15%

  

0%

  

15%

  

30%

  

100%

  

100%

  

15.0%

                  

Final
Performance
Under Plan

  

132.2%

Performance Measure

  Weighting   

Minimum 

(50%)

 

  

Target

(100%)

 

  

Maximum 

(200%)(2)

 

  

Results 

 

Adjusted EPS

  

50%

  

$27.00

  

$28.00

  

$29.00

  

$26.09

 

Net Promoter Score (NPSr)(1)

  

15%

  

 1.1% below 2022 
performance (YoY)

  

 1.7% - 12.1% above 
2022 performance

  

 14.9% above 2022 
performance

  

 Flat to 2022 
performance

 

Membership Growth

  

20%

  

350,000

  

400,000 - 425,000

  

475,000

  

843,300

(1)

Target NPStNPSr represents the Company’s NPStNPSr goal for the year. The spread between minimum/target and target/maximum is +/- 7.5% of the target goal.

Under the terms of the Executive Incentive Compensation Plan,

(2)

Under the terms of the AIP, in the event that the financial measure (Adjusted EPS) results are at or below target, the non- financial measures are capped at target.

The Committee then reviewed the Company’s Adjusted EPS performance was subject to an automatic adjustment due toin advancing the impacts of acquisition activity andstrategic measures discussed above in the extraordinary, unusual and infrequent impacts experienced by the Company as a result of the COVID-19 pandemic. Following these automatic adjustments,section entitled “AIP Strategic Measures,” noting the Company’s Adjusted EPSstrong Star Ratings performance, as defined under the Executive Incentive Compensation Plan was $22.09, resultingsuccess in a performance rate for the Adjusted EPS performance factor of 136.65%.

In evaluating these results, the Committee considered the unpredictable disruption of the COVID-19 pandemic on the Company’s financial resultsdeveloping an enterprise plan to create continuous improvement in operating leverage, and operating performance, along with the volatility and disruption on the healthcare system as a whole. The Committee also considered the leadership of the management teamprogress in maintaining the strong core operational performance of the Company and making significant advancementsexecuting on its strategic priorities, while seekingstrategy to mitigatereduce costs and improve health outcomes by increasing the impactnumber of the COVID-19 pandemic for the Company and its members associates and stakeholders. Finally, the Committee also considered the Company’s Adjusted EPS results without the automatic adjustments under the Executive Incentive Compensation Plan.who utilize two or more CenterWell services.

Following this review, the Committee determined that no AIP payment would be made to the Company’s management team recommended, and(including its NEOs) because the Committee elected,Company had failed to exercise negative discretion to reduceachieve threshold Adjusted EPS performance, the AIP funding rategate for the Company’s management team to 90% ofas established by the targeted total payout, reflecting the performance under the Executive Incentive Compensation Plan without any automatic adjustments as called for under the terms of the Plan.Committee.

 

    

Named Executive Officer

  2021 Eligible
Earnings
   2021 Target
Opportunity
   Funding Rate   Actual Payout 
    

Bruce D. Broussard

  

 

$1,349,465   

  

 

175%     

 

    

 

$2,125,407

 

    

Susan M. Diamond

  

 

$ 640,962   

 

  

 

100%     

 

    

 

$576,866

 

    

Brian A. Kane

  

 

$ 762,116   

  

 

100%     

 

  

 

  90%        

 

  

 

$685,904

 

T. Alan Wheatley

  

 

$ 657,308   

  

 

100%     

  

 

$591,577

 

    

Timothy S. Huval

  

 

$ 660,500   

  

 

100%     

 

    

 

$594,450

 

    

William K. Fleming

  

 

$ 558,077   

  

 

100%     

       

 

$502,269

 

    

Named Executive Officer

  

2023 Annual

Base Salary1

   

2023 Target  

Opportunity  

  Funding Rate   Actual Payout  
    

Bruce D. Broussard2 

  

 

$1,469,893   

 

  

193.84%   

    

$0  

    

Susan M. Diamond

  

 

$790,000   

 

  

100%   

    

$0  

    

Sanjay K. Shetty, M.D.3

  

 

$493,269   

 

  

100%   

  

 

0%  

  

$0  

    

Joseph C. Ventura

  

 

$678,000   

 

  

100%   

    

$0  

    

George Renaudin II

  

 

$655,000   

 

  

100%   

       

$0  

 

60(1)

Humana  |  2022 Proxy Statement  Compensation Discussion and Analysis

Pay increases occurred during the AIP Performance Period with respect to certain of our Named Executive Officers resulting in a blended base salary.

(2)

Effective March 1, 2023, Mr. Broussard’s target opportunity increased from 175% to 200%, resulting in a blended percentage.


(3)

The amount indicated for Dr. Shetty represents nine-months of service during 2023.

Long-Term Incentives

Long-Term IncentivesOur long-term incentives (LTI) provide a vital link between the long-term results achieved for our stockholders and the financial rewards provided to our NEOs. The Committee, in consultation with its independent compensation consultant, annually determines the aggregate amounts and terms of long-term incentive compensation awards for our executive officers using (i) compensation programs and competitive pay practices of peer companies and (ii) the outstanding equity information for each executive officer using tally sheets to examine the value of prior compensation decisions.

The Committee approved the following mix of long-term incentive awards granted in 2021 to our NEOs, reaffirming its commitment to performance-based compensation through an increase in weighting since 2020:

 

Performance-Based Stock Units

 

 

 

Restricted Stock Units

 

 

 

Stock Options

 

 

55%

 

 

 

22.5%

 

 

 

22.5%

 

•  Reinforces our pay-for-performance culture

 

•  Focuses on three-year cumulative goals for adjusted return on invested capital (ROIC) and the advancement of key strategic measures

 

•  Measures the returns generated by investment in the Company and represents management’s ability to build long-term value for the organization

 

•  Highly correlated with value creation for our stockholders

 

•  Includes a rTSR modifier that will adjust final award payouts up or down based on how the Company performs relative to the approved 2021 PSU Comparator Group (+/- 20%)

 

•  Promotes retention of our executive talent

 

•  Aligns executive officers’ interests with that of our stockholders

 

•  Allows executive officers to build stock ownership positions

 

•  Provides value regardless of stock price volatility

 

•  Offers long-term financial opportunities to our executives beyond salary

 

•  Aligns the interest of executive officers with stockholders by placing emphasis on long-term value creation through promoting growth in our stock price

 

•  Promotes connectedness with the Company and its long-term strategy, reinforcing the financial success of the organization

 

•  Offers long-term financial opportunities to our executives beyond salary

The Committee believes that a mix of long-term incentives, combined with performance measures and a rTSR modifier:

 

Aligns executives with the interests of our stockholders;

Allows executives to focus on measures they have the ability to influence while also satisfying stockholder expectations of using a relative measure;

Ensures that our long-term incentive compensation program is not overly dependent upon rTSR as an independent measure; and

Adjusts to general economic conditions that would impact all companies in our Peer Group.

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Humana | 2024 Proxy Statement Compensation Discussion and Analysis


Design of Long-Term Incentives Granted in 2023

For long-term incentives granted in February 2023, the Committee (i) updated the design of our stockholders;

Allows executivesperformance stock units to focus onincorporate commitments made during our 2022 Investor Day and align the performance measures they have the ability to influence while also satisfying stockholder expectations of using a relative measure;

Ensures thatin our short- and long-term incentive compensation program is not overly dependent upon rTSRprograms to the mid-term goals of the Company, including our 2025 mid-term adjusted EPS target announced at our 2022 Investor Day, and (ii) approved a mix of long-term incentive awards granted in 2023 to our NEOs with adjusted weighting, as an independent measure; andfollows:

 

  

Performance-Based Stock Units

  Restricted Stock Units  Stock Options

50%

  

25%

  

25%

  Reinforces our pay-for-performance culture and aligns to our external commitments

 

  Focuses on our 2025 mid-term adjusted EPS target

 

  Includes commitment to drive ongoing operating efficiencies

 

  Includes a relative Total Shareholder Return (rTSR) modifier that can adjust final award payouts up/down based on Company performance relative to the approved 2023 PSU Comparator Group (+/- 20%)

 

  Measures performance against key strategic initiatives to create sustainable customer value and drive long-term strategic performance, outlined in illustration below

 

  

  Promotes retention of our executive talent

 

  Aligns executive officers’ interests with that of our stockholders

 

  Allows executive officers to build stock ownership positions

 

  Provides value regardless of stock price volatility

 

  Offers long-term financial opportunities to our executives beyond salary

  

  Aligns the interest of executive officers with stockholders by placing emphasis on long-term value creation through promoting growth in our stock price

 

  Promotes connectedness with the Company and its long-term strategy, reinforcing the financial success of the organization

 

  Offers long-term financial opportunities to our executives beyond salary

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61


Adjusts to general economic conditions that would impact all companies in our Peer Group.

The Committee approved the following 20212023 stock-based compensation for the CEO and other NEOs:

 

    

Named Executive Officer

  

PSUs

55%(1)

   

RSUs

22.5%

   

Options

22.5%

   Total 2021
LTI Award
 
    

Bruce D. Broussard

  

$

6,806,250

 

  

$

2,784,375

 

  

$

2,784,375

 

  

$

12,375,000

 

    

Susan M. Diamond

  

$

1,012,000

 

  

$

814,000

 

  

$

814,000

 

  

$

2,640,000

 

    

Brian A. Kane

  

$

2,117,500

 

  

$

866,250

 

  

$

866,250

 

  

$

3,850,000

 

    

T. Alan Wheatley

  

$

1,518,000

 

  

$

621,000

 

  

$

621,000

 

  

$

2,760,000

 

    

Timothy S. Huval

  

$

1,119,250

 

  

$

457,875

 

  

$

457,875

 

  

$

2,035,000

 

    

William K. Fleming

  

$

1,075,250

 

  

$

439,875

 

  

$

439,875

 

  

$

1,955,000

 

    

Named Executive Officer

  

PSUs

50%(1)

   

RSUs

25%

   

Options

25%

   Total 2023
LTI Award
 
    

Bruce D. Broussard

  

$

7,000,000

 

  

$

3,500,000

 

  

$

3,500,000

 

  

$

14,000,000

 

    

Susan M. Diamond

  

$

1,800,000

 

  

$

900,000

 

  

$

900,000

 

  

$

3,600,000

 

    

Sanjay K. Shetty, M.D.

  

$

900,000

 

  

$

450,000

 

  

$

450,000

 

  

$

1,800,000

 

    

Joseph C. Ventura

  

$

1,100,000

 

  

$

550,000

 

  

$

550,000

 

  

$

2,200,000

 

    

George Renaudin II

  

$

1,100,000

 

  

$

550,000

 

  

$

550,000

 

  

$

2,200,000

 

(1)

Performance-based restricted stock units are shown at target value.

Compensation Discussion and Analysis   2022 Proxy Statement  |  Humana

61


PerformanceResults of our 2019-2021Our Performance-Based Restricted Stock Units Granted in 2021

Design Framework

In 2019,2021, the Committee granted performance-based stock unit awards to our then-serving NEOs, with performance criteria for these awards based on both the Company’s average adjusted return on invested capital (Adjusted ROIC)(1) and certain long-term strategic measures, in each case measured against an established set of targets over the three-year period beginning January 1, 20192021 and ending December 31, 2021,2023, referred to herein as our “2019-2021“2021-2023 PSU Awards.” The 2019-20212021-2023 PSU Awards also included a relative total stockholder returnrTSR modifier (rTSR) that could adjust final payout results up or down based on the Company’s TSR ranking against an approved comparator group.Comparator Group.

The following discloses the three-year cumulative goals included in the 2019-20212021-2023 PSU Awards, which provide for incremental payout between steps:

 

2019-2021 PSU Awards

  

Minimum

(50%)

 

Target

(100%)

 

Maximum

(200%)

Financial Measure:
Adjusted ROIC

 13.1% 14.45% - 14.75% 16.1%

 3-Year Average ROIC target of 14.6%, with a target corridor of +/- 0.15%

 

 Spread between minimum/target and target/maximum of +/- 10%

 

 Incremental payout using linear interpolation if performance is within the ranges noted above

rTSR Modifier                     + /-20%

    

2021-2023 PSU Awards

  Weighting 

Minimum

(50%)

 

Target

(100%)

 

Maximum

(200%)

Financial Measure:
Adjusted ROIC

 70% 13.05% 14.35% - 14.65% 15.95%

 3-Year Average ROIC target of 14.5%, with a target corridor of +/- 0.15%

 

 Spread between minimum/target and target/maximum of +/- 10%

 

 Incremental payout using linear interpolation if performance is within the ranges noted above

Strategic Measures

      30%      

rTSR Modifier     

 + /-20%      

rTSR Modifier (2019(2021 Peer Group as Comparator Group)

 

Ranked on a percentile basis against peers; +/- 20% is determined after ROIC performance is measured, and is applied as follows (with maximum

payout capped at 200% of target opportunity and incremental modification using linear interpolation if performance is within the ranges noted below):

< 25th Percentile:  - 20%
45th – 55th Percentile:  No Modifier Applied
> 75th Percentile:  + 20%

 

(1)

For purposes of the 2019-20212021-2023 PSU Awards, we define Adjusted ROIC, which is a non-GAAP performance measure, as adjusted net operating profit after tax (Adjusted NOPAT) divided by average invested capital (AIC). Adjusted NOPAT, which is a non-GAAP financial measure, is defined as GAAP net operating income as adjusted for non-GAAP items consistent with those reported in our public earnings release plus tax effected interest expense. AIC is defined as average shareholder’s equity plus average debt minus parent company cash (excluding $500 million for required reserves). The terms of the 2019-20212021-2023 PSU Awards further provide that for purposes of determining results under the awards for any individual fiscal year within the performance period, the applicable elements of Adjusted ROIC shall automatically adjust to reflect the impact of certain non-recurring events, including the impacts of merger, acquisition and disposition activity, changes in accounting standards, litigation or regulatory investigations outside of the ordinary course of business, restructuring activity outside of the ordinary course of business, business exit or disposal activities, and any extraordinary, natural disaster, unusual or infrequent event. However, the Committee retains the ability to exercise negative (but not positive) judgment with respect to any award, regardless of the impact of any automatic adjustments.

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Alignment of Strategic Measures

Beginning in 2021, the Committee considered additional approaches to drive management focus on the Company’s long-term transformation to become an integrated healthcare company by improving the quality of care delivered to the Company’s members, significantly advanced its healthcare services platform through the expansion of its senior-focused, value-based primary care organization, and the continued integration of its home health organization. Following this review, the Committee decided to add long-term strategic measures as an element of the 2021-2023 PSU Awards to compliment the continued long-term focus on delivering returns on invested capital through a focus on Adjusted ROIC. The strategic measures included in the 2021-2023 PSU Awards directly align to these long-term strategic priorities, as summarized below.

LOGO

Performance Achievement Results

When determining the vesting value of the 2019-20212021-2023 PSU Awards, the Committee reviewed final Company results showing a three-year cumulativeaverage Adjusted ROIC of 15.6%15.35% as determined under the terms of the 2019-20212021-2023 PSU Awards, including certain automatic adjustments due to the impacts of acquisition activity and the extraordinary unusual and infrequent impacts experienced by the Company as a result of the COVID-19 pandemic during certain portions of the performance period, achievement against the strategic measures noted above between their target and maximum range, and a rTSR ranking in the 47.815.1thst percentile of the comparator group. As part of this review, the Committee also noted that Adjusted ROIC and rTSR performance are a by-product of both the financial and operational performance of the Company over the three-year period. As such, the Committee took into account strong earnings, revenue and membership growth over the majority of performance period, while noting TSR and substantial progress made in executing on its long-term strategy over the performance period. This strategy includes moving from an insurance company with elements of healthperiod that resulted in a 20% reduction to a health company with elements of insurance.the performance metrics achieved under the 2021-2023 PSUs. The Company tookCommittee further steps to advanceconsidered performance on the strategic measures included in the 2021-2023 PSU Awards, and their impact on improving the quality of care delivered to the Company’s members, and significantly advancedadvancing its healthcare services platform through the expansion of its senior-focused, value-based primary care organization, and integrating the Company’s home health and hospice organization.

During its February 20222024 meeting, based on the review described above, the Committee approved an award payout at 162.9%124.9% of target amounts, as determined under the terms of the 2019-20212021-2023 PSU Awards, with no discretionary exceptions or adjustments, as shown below.

 

   
  Final Result  Funding Rate  Modifier  Final Payout ResultsFinal ResultFinal ResultFunding RateFunding RateWeightingWeightingModifierModifierFinal Payout ResultsFinal Payout Results
   

Adjusted ROIC

  15.6%  162.9%      15.35%15.35%154.0%154.0%70%70%107.8%107.8%
   

Strategic Measures

Target - Max161.3%30% 48.4%
 

2021-2023 PSU Metric Performance

156.2%
 

rTSR Modifier

  47.8th Percentile     0.00%   
 
 

Final Payout

           162.9%124.9%124.9%

The Committee determined the above results were appropriate given the substantial progress made on long-term initiatives and the strong financial performance achieved during the 3-year performance period, particularly within the challenges presented during 2021.period.

 

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Compensation Discussion and Analysis 2024 Proxy Statement | Humana

   

Humana  |  2022 Proxy Statement  Compensation Discussion and Analysis

63


Other Benefits and Perquisites

We operate in a highly competitive, complex and consolidating industry and offer certain benefits that we believe are critical to attract and retain talent. In general, our NEO’s are eligible for the same benefits as our associate population. We offer a limited number of perquisites to attract and retain our executives but we do not provide any tax reimbursements or “gross-ups” for these benefits.

 

  

  Health and Retirement Benefits

 

  

    

 

   

                    
 
 

•  Our executive officers participate in the broad-based employeeassociate health and retirement programs under the same terms and conditions as all other eligible associates.

   

 
 
 

•  Such benefits include: medical, dental, vision, disability, wellness, life and accidental death and dismemberment (AD&D) insurance, as well as 401(k) retirement plan, supplemental 401(k) plan and the option to participate in our Nonqualified Deferred Compensation Plan.

 

   

 
    
  

  Perquisites

 

  

    

 

   

                    
 
 

•  We provide limited perquisites to our executive officers, which are aligned with market practices and are reviewed on a regular basis.

   

 
 
 

•  Perquisites may include limited personal use of the Company aircraft, personal security, personal executive support services, an annual physical, a matching charitable gift program, a supplemental life insurance benefit, financial planning assistance, and, if applicable, relocation assistance.

 

   

 
    
  

  Executive Severance and Change in Control

 

  

    

 

   

                    
 
 

•  The Severance Policy provides for benefits in the event employment is terminated without cause, for a defined severance period during which certain restrictive covenants would apply (e.g., non-compete, non-solicit and non-disparagement covenants):

 

-  CEO: 24 months base salary and target bonus, with two yeartwo-year restrictive covenants;covenants

 

-  Other NEOs: 18 months base salary only, with 18 month18-month restrictive covenants.covenants

   

   

   

 
 
 

•  The Change in Control Policy (CIC Policy) provides for benefits in the event that employment is terminated under certain circumstances in connection with a Change in Control transaction, with restrictive covenants binding the executive during the applicable severance period:

 

-  CEO: lump sum payment of 30 months base salary and target bonus, with 30 month30-month restrictive covenants;covenants

 

-  Other NEOs: lump sum payment of 24 months base salary and target bonus, with 24 month24-month restrictive covenants.covenants

 

   

   

   

 

 

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Humana | 2024 Proxy Statement Compensation Discussion and Analysis  2022 Proxy Statement  |  Humana

 

63


Compensation Risk Management, Policies and Practices

We review our compensation programs to ensure appropriate governance and risk management practices. We believe that our policies and practices align with evolving best practices, while ensuring appropriate balance of risk and reward. Certain key risk management policies that pertain to executive compensation are as follows:

 

   

  Clawback Policy

 

     

    

 

   

                    
 
 

•  Our Board hasWe have adopted a Compensation Recoupment Policy (“Recoupment Policy”) that covers each of our executive officers and appliesis intended to comply with the requirements of Section 10D of the Exchange Act and Section 303A.14 of the NYSE Listed Company Manual with respect to the mandatory recovery of certain specified financial-based incentive compensation including any cash incentive or equity award paid or awarded duringin connection with specified accounting restatements, without regard to the period in which he or she is designated asfault of an executive officer. For all executive officers, the Company may recoup such incentive compensationIn addition, our Recoupment Policy also incorporates our long-standing recoupment policies in the event of: (a) a material restatement of the Company’s financial statements; or (b)that an executive officer engages in certain specified improper conduct that in the discretion of the Committee is likely to cause or has caused material financial, operational or reputational harm to the Company. A potential recoupment in connection with improper conduct applies to all forms of incentive compensation. A copy of our Recoupment Policy is filed with the SEC as an exhibit to our 2023 Form 10-K.

 

   

 
    
   

  Hedging and Pledging Policy

 

     

    

 

   

                    
 
 

•  OurAll of our associates and Board has adopted a policy prohibiting all employees, including executive officers and directors,Directors are prohibited from engaging in short-term, speculative transactions in Company securities and therefore prohibits any hedging or pledging of Company securities, including puts, calls or other derivative securities.

 

  

 
    
   

  Stock Ownership Guidelines

 

     

    

 

   

                    
 
 

•  Our stock ownership guidelines link a significant amount of our executives’ current and potential net worth to the Company’s success in alignment with the interests of our stockholders.

   

 
 
 

•  Ownership guidelines are expressed as a multiple of base salary and must be held until the relevant multiple is reached and maintained thereafter, as follows:

 

-  Chief Executive Officer: 7x base salary

 

-  CEO Direct Reports (including all NEOs): 3x base salary

 

-  Senior Vice Presidents: 1x base salary

 

   

   

   

   

 
    
   

  Insider Trading Policy

 

     

    

 

   

                    
 
 

•  OurAll of our associates and Board has adopted a policy prohibiting all employees, including executive officersDirectors (and their respective immediate family and directors,household members) are prohibited from “tipping” or trading on inside information.

   

 
 
 

•  The policy expressly prohibits purchasing or selling any securities of the Company (including, without limitation, a stock plan transaction such as an option exercise, transfer in the Company’s Retirement and Savings Plan, gift, loan, pledge or hedge, contribution to a trust, or any other sale or transfer, regardless of how the securities are held), while aware of material, non-public information concerning the Company.

 

   

 

 

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Humana  |  2022 Proxy Statement  Compensation Discussion and Analysis

65


Organization & Compensation Committee Report

 

The Organization & Compensation Committee of the Company has reviewed and discussed the Compensation Discussion and Analysis for the year ended December 31, 20212023 with management. In reliance on these reviews and discussions, the Organization & Compensation Committee recommended to the Company’s Board of Directors, and the Board of Directors has approved, the inclusion of this Compensation Discussion and Analysis in this proxy statement.

All members of the Organization & Compensation Committee of the Company whose names follow submit the foregoing report:

ORGANIZATION & COMPENSATION COMMITTEE

James J. O’Brien, Chairman

Wayne A. I. Frederick, M.D., Chair

David A. Jones, Jr.Karen W. Katz

Jorge S. MesquitaBrad D. Smith

 

*

We have included an Adjusted EPS financial measure (not in accordance with Generally Accepted Accounting Principles (GAAP)) in ourPlease refer to Annex III to this proxy statement as we believe that this measure, when presented in conjunction with the comparablefor a reconciliation of non-GAAP to GAAP measure, is useful to both management and its investors in analyzing our ongoing business and operating performance. Consequently, we use this non-GAAPfinancial measure as an indicator of business performance, as well as for operational planning and decision making purposes. Non-GAAP financial measures should be considered in addition to, but not as a substitute for, or superior to, financial measures prepared in accordance with GAAP. The following excluded items are not recurring parts of our operating plan: (i) amortization expense for identifiable intangibles of approximately $65 million pretax; (ii) gain associated with Kindred at Home equity method investment of approximately $1,129 million which was recorded upon closing of the Kindred at Home transaction in August 2021; (iii) put/call valuation adjustments of approximately $597 million associatedwith the Company’s non-consolidating minority interest investments including the impact of the termination of the put/call agreement related to Kindred at Home as a result of the transaction announced on April 27, 2021; (iv) transaction and integration costs associated with Kindred at Home acquisition of approximately $128 million; and (v) change in fair market value of publicly-traded equity securities of $341 million. To arrive at GAAP EPS of $22.67: (i) amortization associated with identifiable intangibles of $0.39 per diluted common share; (ii) gain associated with Kindred at Home equity method investment of approximately $8.73 per diluted common share which was recorded upon closing of the Kindred at Home transaction in August 2021; (iii) put/call valuation adjustments associated with the Company’s non-consolidating minority interest investments including the impact of the termination of the put/call agreement related to Kindred at Home as a result of the transaction announced on April 27, 2021 of $3.56 per diluted common share; (iv) transaction and integration costs associated with Kindred at Home acquisition of approximately $0.72 per diluted common share; and (v) change in fair market value of publicly-traded equity securities of $2.03 per diluted common share.measures. We encourage each stockholder to read theour full financial analysisstatements for the year ended December 31, 20212023 contained in our Annual Report on Form 10-K, filed with the SEC on February 17, 2022. 15, 2024.

**

Stock repurchases includes $73 million in connection with employee stock plans.

***

Membership totals in MA plans with 4+ Star Rating reflect membership as of October 2023 when Star Ratings were released by the Centers for Medicare & Medicaid Services (CMS).

 

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Humana | 2024 Proxy Statement Organization & Compensation Committee Report  2022 Proxy Statement  |  Humana

 

65


Executive Compensation

 

Summary Compensation Table

The following Summary Compensation Table shows the compensation earned for the time period served as ana named executive officer during the last three fiscal years by (i) Bruce D. Broussard, our President and Chief Executive Officer; (ii) Susan M. Diamond, our Chief Financial Officer; (iii) Brian A. Kane, our former Chief Financial Officer; and (iv)(iii) each of our three other highest compensated executive officers serving at December 31, 20212023 (we collectively refer to these officers in this proxy statement as our “Named Executive Officers”).

 

Name and Principal

Position

 Year 

Salary

($)

 

 Bonus 

($)

 

Stock

Awards

($)(1)(3)

 

Option

Awards

($)(2)

 

Non-Equity

Incentive

Plan

 Compensation 

($)(3)

 

Change in

Pension Value

and

Nonqualified

Deferred

 Compensation 

Earnings

($)

 

All

Other

 Compensation 

($)(4)

 

Total

($)

 

 

Bruce D. Broussard,
President and Chief
Executive Officer

 

   

 

 

 

2021

 

 

 

 

 

 

   

 

 

 

1,349,465

 

 

 

 

 

 

   

 

 

 

—  

 

 

 

 

 

 

   

 

 

9,828,769

 

 

 

 

   

 

2,779,774

 

 

   

 

2,125,407

 

 

   

 

—  

 

 

   

 

444,621

 

 

   

 

16,528,036

 

 

   

 

2020

 

 

   

 

1,349,465

 

 

   

 

—  

 

 

   

 

8,510,832

 

 

   

 

2,809,535

 

 

   

 

3,292,020

 

 

   

 

—  

 

 

   

 

527,787

 

 

   

 

16,489,639

 

 

   

 

2019

 

 

   

 

1,335,069

 

 

   

 

—  

 

 

   

 

8,479,360

 

 

   

 

2,814,192

 

 

   

 

3,612,030

 

 

   

 

—  

 

 

   

 

485,804

 

 

   

 

16,726,455

 

 

Susan M. Diamond
Chief Financial Officer

   

 

2021

 

 

   

 

640,962

 

 

   

 

—  

 

 

   

 

1,861,200

 

 

   

 

813,976

 

 

   

 

576,866

 

 

   

 

—  

 

 

   

 

168,477

 

 

   

 

4,061,481

 

 

Brian A. Kane,
Former Chief Financial Officer

   

 

2021

 

 

   

 

762,116

 

 

   

 

—  

 

 

   

 

3,058,073

 

 

   

 

864,859

 

 

   

 

685,904

 

 

  

 

 

 

 

—  

 

 

 

   

 

191,220

 

 

   

 

5,562,172

 

 

   

 

2020

 

 

   

 

750,000

 

 

   

 

—  

 

 

   

 

2,647,761

 

 

   

 

874,101

 

 

   

 

1,045,500

 

 

   

 

—  

 

 

   

 

226,196

 

 

   

 

5,543,558

 

 

   

 

2019

 

 

   

 

740,577

 

 

   

 

—  

 

 

   

 

2,449,601

 

 

   

 

813,009

 

 

   

 

1,144,933

 

 

   

 

—  

 

 

   

 

233,004

 

 

   

 

5,381,124

 

 

T. Alan Wheatley,
Segment President, Retail

   

 

2021

 

 

   

 

657,308

 

 

   

 

—  

 

 

   

 

2,192,247

 

 

   

 

620,002

 

 

   

 

591,577

 

 

   

 

—  

 

 

   

 

161,090

 

 

   

 

4,222,224

 

 

   

 

2020

 

 

   

 

625,000

 

 

   

 

—  

 

 

   

 

1,815,538

 

 

   

 

599,354

 

 

   

 

871,250

 

 

   

 

—  

 

 

   

 

169,064

 

 

   

 

4,080,206

 

 

   

 

2019

 

 

   

 

596,731

 

 

   

 

—  

 

 

   

 

1,658,238

 

 

   

 

542,620

 

 

   

 

922,546

 

 

   

 

—  

 

 

   

 

121,454

 

 

   

 

3,841,589

 

 

Timothy S. Huval,
Chief Administrative Officer

   

 

2021

 

 

   

 

660,500

 

 

   

 

—  

 

 

   

 

1,616,410

 

 

   

 

457,098

 

 

   

 

594,450

 

 

  

 

 

 

 

—  

 

 

 

   

 

173,565

 

 

   

 

3,502,023

 

 

   

 

2020

 

 

   

 

650,000

 

 

   

 

—  

 

 

   

 

1,286,194

 

 

   

 

424,533

 

 

   

 

906,100

 

 

   

 

—  

 

 

   

 

205,608

 

 

   

 

3,472,435

 

 

   

 

2019

 

 

   

 

638,866

 

 

   

 

—  

 

 

   

 

1,281,282

 

 

   

 

425,238

 

 

   

 

987,687

 

 

   

 

—  

 

 

   

 

177,052

 

 

   

 

3,510,125

 

 

William K. Fleming, PharmD
Segment President,
Pharmacy Solutions &
Chief Corporate Affairs
Officer

   

 

2021

 

 

   

 

558,077

 

 

   

 

—  

 

 

   

 

1,552,763

 

 

   

 

439,191

 

 

   

 

502,269

 

 

   

 

—  

 

 

   

 

155,057

 

 

   

 

3,207,357

 

 

   

 

2020

 

 

   

 

550,000

 

 

   

 

—  

 

 

   

 

1,361,918

 

 

   

 

449,498

 

 

   

 

766,700

 

 

   

 

—  

 

 

   

 

185,949

 

 

   

 

3,314,065

 

 

   

 

2019

 

 

   

 

535,866

 

 

   

 

—  

 

 

   

 

1,507,517

 

 

   

 

493,316

 

 

   

 

828,448

 

 

   

 

—  

 

 

   

 

130,851

 

 

   

 

3,495,998

 

 

Name and Principal

Position

 Year  

Salary

($)

  

 Bonus 

($)

  

Stock

Awards

($)(1)(3)

  

Option

Awards

($)(2)

  

Non-Equity

Incentive

Plan

 Compensation 
($)
(3)

  

 

Change in

Pension Value

and

Nonqualified

Deferred

 Compensation 

Earnings

($)

  

All

Other

 Compensation 

($)(4)

  

Total

($)

 
         

Bruce D. Broussard,
Chief Executive Officer

  2023   1,469,893   —    10,898,833   3,492,874   —    —    465,784   16,327,384 
  2022   1,349,465   —    9,638,547   2,785,410   3,072,394   —    353,028   17,198,844 
  2021   1,349,465   —    9,828,769   2,779,774   2,125,407   —    444,621   16,528,036 
         

Susan M. Diamond,
Chief Financial Officer

  2023   790,000   —    2,802,776   898,145   —    —    239,812   4,730,733 
  2022   750,000   —    2,258,317   652,754   975,750   —    174,177   4,810,998 
  2021   640,962   —    1,861,200   813,976   576,866   —    168,477   4,061,481 
         

Sanjay K. Shetty, M.D.,
President, CenterWell

  2023   493,269   1,400,000   1,401,072   449,844   —    —    837,756   4,581,941 
         

Joseph C. Ventura,
Chief Legal Officer

  2023   678,000   —    1,712,892   548,910   —    —    162,359   3,102,161 
  2022   600,596   —    1,596,932   461,458   784,147   —    155,664   3,598,797 
         

George Renaudin II,
President, Medicare &
Medicaid

  2023   655,000   —    1,712,892   548,910   —    —    135,676   3,052,478 

(1)

The amounts listed under the column “Stock Awards” in the Summary Compensation Table above disclose the aggregate grant date fair value of equity awards granted in fiscal years 2019, 20202021, 2022 and 2021,2023, calculated in accordance with FASB ASC Topic 718, “Compensation — Stock Compensation.” Note 14 to the Notes to Consolidated Financial Statements of our Annual Report on Form 10-K for the year ended December 31, 2021,2023, describes the assumptions used to determine the grant date fair value for overall Company equity awards. Performance-based units are disclosed at target value — for a presentation of the ranges of potential values of these performance-based awards at vesting dependent upon the achievement of performance measures, please refer to the table entitled, “Grants of Plan-Based Awards” in this proxy statement.

The aggregate grant date fair value of each 20212023 performance-based restricted stock unit award assuming that the highest level of performance conditions will be achieved is as follows:

 

 

 

Named Executive Officer

 

  

 

Grant Date Fair  


Value

 

 

 

Bruce D. Broussard

  

 

$14,000,034  

$13,612,192 

 

 

Susan M. Diamond

  

 

$ 3,600,271  

$  2,023,902 

 

 

Sanjay K. Shetty, M.D.

Brian A. Kane

  

 

$ 1,800,000  

$  4,235,356 

 

 

Joseph C. Ventura

T. Alan Wheatley

  

 

$ 2,200,166  

$  3,036,230 

 

 

George Renaudin II

Timothy S. Huval

  

 

$ 2,200,166  

$  2,238,570     

William K. Fleming

$  2,150,443 

 

(2)(3)

The amounts listed under the “Option Awards” column in the Summary Compensation Table above disclose the aggregate grant date fair value of stock option awards granted in fiscal years 2019, 20202021, 2022 and 2021,2023, calculated in accordance with FASB ASC Topic 718, “Compensation — Stock Compensation.” Note 14 to the Notes to Consolidated Financial Statements of our Annual Report on Form 10-K for the year ended December 31, 2021,2023, describes the assumptions used to determine the grant date fair value for overall Company stock options.

 

66

Executive Compensation 2024 Proxy Statement | Humana

  

Humana  |  2022 Proxy Statement  Executive Compensation

67


The assumptions used for valuing the Named Executive Officers’ stock options as a group, applying the Black-Scholes methodology, were as follows:

 

   

 

2021

 

 

2020

 

 

2019

 

 

 2023 

 

 

 2023 

 

 

 2022 

 

 

 2022 

 

 

 2021 

 

 

 2021 

 

   

Weighted Average Fair Value at Grant Date

 

$

 

92.21

 

 

$

 

69.73

 

 

$

 

68.53

 

 

$

 

130.74

 

 

$

 

113.35

 

 

$

 

92.21

 

   

Expected Option Life (Years)

 

 

 

3.7

 

 

 

 

4.0

 

 

 

 

4.1

 

 

 

 

3.0

 

 

 

 

3.6

 

 

 

 

3.7

 

   

Expected Volatility

 

 

 

33.8

 

%

 

 

 

24.9

 

%

 

 

 

25.5

 

%

 

 

 

31.6

 

%

 

 

 

36.1

 

%

 

 

 

33.8

 

%

   

Risk Free Interest Rate

 

 

 

0.4

 

%

 

 

 

1.2

 

%

 

 

 

2.4

 

%

 

 

 

4.5

 

%

 

 

 

1.8

 

%

 

 

 

0.4

 

%

   

Dividend Yield

 

 

 

0.7

 

%

 

 

 

0.7

 

%

 

 

 

0.7

 

%

 

 

 

0.7

 

%

 

 

 

0.7

 

%

 

 

 

0.7

 

%

 

(3)

For a discussion of the potential ranges that could have been earned in 20212023 under our short-term incentive compensation plan, refer to the table entitled, “Grants of Plan-Based Awards,” and for a discussion of the actual amounts awarded to our Named Executive Officers in light of the Company’s performance, see the section entitled, “Compensation, Discussion and Analysis — Plan Design and Award Decisions — Short-Term Incentives — 20212023 AIP Performance Results” in this proxy statement.

(4)

The amounts listed under the column entitled “All Other Compensation” in the Summary Compensation Table above include: Company contributions to the Humana Retirement Equalization Plan and the Humana Retirement Savings Plan; personal use of Company aircraft; a matching charitable gift program; financial planning assistance; emergency savings matching contributions; relocation assistance; personal security; personal executive support services; basic life insurance premiums; wellness incentives; and physicals, as further described in the table below. This table does not include earnings on the Company’s deferred compensation plans—see the section entitled “Nonqualified Deferred Compensation” below for a discussion of earnings under such plans.

 

      
  

 

Company

  Contributions to  

Humana

Retirement

    Equalization Plan  

($)(a)

 

 

 

Company
  Contributions to  
Humana
Retirement
Savings  Plan

($)

 

 

  Personal Use of  
  Company Aircraft  

($)(b)

 

 

Matching
Charitable
  Contributions  

($)

 

 

Financial
  Planning  

($)

 

 

  Other  

($)(c)

 

 

 

Bruce D. Broussard

  

 

 

 

 

 

326,361

 

 

  

 

 

 

 

 

21,750

 

 

  

 

 

 

 

 

20,115

 

 

  

 

 

 

 

 

40,000

 

 

  

 

 

 

 

 

18,970

 

 

  

 

 

 

 

 

17,425   

 

 

 

 

Susan M. Diamond

  

 

 

 

 

 

79,703

 

 

  

 

 

 

 

 

21,750

 

 

  

 

 

 

 

 

10,932

 

 

  

 

 

 

 

 

30,000

 

 

  

 

 

 

 

 

18,970

 

 

  

 

 

 

 

 

7,122   

 

 

 

 

Brian A. Kane

  

 

 

 

 

 

113,821

 

 

  

 

 

 

 

 

21,750

 

 

  

 

 

 

 

 

0

 

 

  

 

 

 

 

 

30,000

 

 

  

 

 

 

 

 

18,970

 

 

  

 

 

 

 

 

6,679   

 

 

 

 

T. Alan Wheatley

  

 

 

 

 

 

92,892

 

 

  

 

 

 

 

 

21,750

 

 

  

 

 

 

 

 

0

 

 

  

 

 

 

 

 

19,006

 

 

  

 

 

 

 

 

18,970

 

 

  

 

 

 

 

 

8,472   

 

 

 

 

Timothy S. Huval

  

 

 

 

 

 

95,745

 

 

  

 

 

 

 

 

21,750

 

 

  

 

 

 

 

 

0

 

 

  

 

 

 

 

 

30,000

 

 

  

 

 

 

 

 

18,970

 

 

  

 

 

 

 

 

7,100   

 

 

 

 

William K. Fleming

  

 

 

 

 

 

77,608

 

 

  

 

 

 

 

 

21,750

 

 

  

 

 

 

 

 

0

 

 

  

 

 

 

 

 

30,000

 

 

  

 

 

 

 

 

18,970

 

 

  

 

 

 

 

 

6,729   

 

 

      
 

 

Company

 Contributions to 

Humana

Retirement

 Equalization Plan
($)
(a)

Company
 Contributions to
Humana
Retirement
Savings Plan

($)

 Personal Use of
 Company Aircraft 

($)(b)

Matching
Charitable
 Contributions 

($)

Financial
 Planning 

($)

 Other  

($)(c)(d)

 

 

Bruce D. Broussard

 

 

 

 

 

315,922

 

 

 

 

 

 

 

24,750

 

 

 

 

 

 

 

54,840

 

 

 

 

 

 

 

40,000

 

 

 

 

 

 

 

18,340

 

 

 

 

 

 

 

11,932 

 

 

 

 

Susan M. Diamond

 

 

 

 

 

107,681

 

 

 

 

 

 

 

24,750

 

 

 

 

 

 

 

53,775

 

 

 

 

 

 

 

30,000

 

 

 

 

 

 

 

18,970

 

 

 

 

 

 

 

4,636 

 

 

 

 

Sanjay K. Shetty, M.D.

 

 

 

 

 

0

 

 

 

 

 

 

 

0

 

 

 

 

 

 

 

0

 

 

 

 

 

 

 

30,000

 

 

 

 

 

 

 

12,109

 

 

 

 

 

 

 

795,647 

 

 

 

 

Joseph C. Ventura

 

 

 

 

 

84,911

 

 

 

 

 

 

 

24,750

 

 

 

 

 

 

 

0

 

 

 

 

 

 

 

30,000

 

 

 

 

 

 

 

18,970

 

 

 

 

 

 

 

3,728 

 

 

 

 

George Renaudin II

 

 

 

 

 

59,559

 

 

 

 

 

 

 

24,750

 

 

 

 

 

 

 

0

 

 

 

 

 

 

 

30,000

 

 

 

 

 

 

 

15,074

 

 

 

 

 

 

 

6,293 

 

 

 (a)

This amount is also listed in the Nonqualified Deferred Compensation table.

 (b)

The costs of personal use of Company aircraft was based on the aggregate incremental costs to the Company, including the lost tax deduction to the Company and personal deadhead hours.

 (c)

Includes basic life insurance premiums, personal security, wellness incentives, physicals, and physicals. “Other” compensation for Mr. Broussard also includes imputed income in the amount of $6,967 for personal executive support services.emergency savings matching contributions.

CEO Pay Ratio

2021 CEO Pay Ratio

255:1

As detailed further within the “Human Capital Management” section of this proxy statement, our associates’ total compensation may include base pay, incentive pay, overtime and other supplemental pay. We regularly review associate compensation and conduct benchmarking of our pay to the external market where we compete for talent, as well as, internal reviews of associate pay compared to those doing similar work in similar capacities across the Company– all to ensure we are competitive and aligned with industry standards. With respect to our CEO and other Named Executive Officers, as discussed further within the “Compensation Discussion & Analysis” section of this proxy statement, the Organization & Compensation Committee believes that current levels of compensation are appropriate based on the Committee’s multifaceted review.

Our 2021 CEO pay ratio was calculated in compliance with the requirements set forth in Item 402(u) of Regulation S-K. Outlined below is the process that was applied for identifying our median associate for our comparative compensation analysis of the median associate to our CEO.

We identified the median associate using 51,731 global full-time, part-time, temporary and seasonal associates employed as of December 31, 2021, which excludes approximately 43,779 associates who joined us during 2021 as a result of acquisitions and business combinations;

We consistently applied 2021 W-2 earnings as compensation measure for the median associate;

During 2021, the median associate participated in one of our Targeted Incentive Plans (TIP), cash compensation plans that target specific behaviors and outcomes within lines of business and teams, instead of the Associate Incentive Plan. Payments under the TIP are made quarterly based on performance during the previous fiscal quarter. Payments under the TIP for the first three fiscal quarters of 2021 were included within 2021 W-2 earnings. Payment under the TIP for the fourth quarter of 2021 was not included within 2021 W-2 earnings, as this compensation, although earned for the fourth quarter of 2021, is payable during the first quarter of 2022. Therefore, to determine the median associate compensation, we applied the fourth quarter 2021 TIP payment to the median associate’s total 2021 W-2 compensation, and excluded the fourth quarter 2020 TIP amount;

Executive Compensation  2022 Proxy Statement  |  Humana

67


We then calculated the median associate’s compensation in the same manner as the Named Executive Officers in the Summary Compensation Table;

Applying this methodology, our median associate’s total compensation was $64,797, which includes a base salary of $59,378 and 2021 TIP payment of $5,419; and

 (d)

Our Chief Executive Officer’s total compensation was $16,528,036.Includes relocation assistance in connection with Dr. Shetty’s employment in March 2023.

Grants of Plan-Based Awards

The following table provides information about equity awards granted in 20212023 under our Amended and Restated Stock Incentive Plan, which we refer to as the Stock Plan, and the range of potential payments earned in 20212023 under our short-term incentive compensation plan. A discussion of the features of each type of award is included in the footnotes that follow the table.

 

   Name

   (a)

 

Grant
Date

          (b)          

  Estimated Possible Payouts
Under Non-Equity Incentive
Plan Awards(1)
  

 

Estimated Future Payouts
Under Equity Incentive
Plan
Awards(2)

  

 

All
Other

Stock

Awards:

Number

Of
Shares

Of
Stock

or Units

(#)(3)

(i)

  

All

Other

Option

Awards:

Number of

Securities

Underlying

Options

(#)(4)

(j)

  

Exercise

or Base

Price

of

Option

Awards

($/Sh)(5)
(k-1)

  

Closing
Market
Price
on
Grant
Date
($/Sh)

(k-2)

  

Grant
Date Fair
Value of
Stock
and
Option
Awards
($)(6)

(l)

 
 

Threshold
($)

(c)

  

Target
($)

(d)

  

Maximum
($)

(e)

  

Threshold
(#)

(f)

  

Target
(#)

(g)

  

Maximum
(#)

(h)

 
            

Bruce D. Broussard

  03/01/2021   1,180,813   2,361,625   4,723,250                                 
            
  02/22/2021               7,228   18,072   36,144               379.89   7,044,490 
            
  02/22/2021                           7,393           379.89   2,784,278 
            
  02/22/2021                               265   376.61   379.89   24,212 
            
   02/22/2021                               30,160   376.61   379.89   2,755,562 
            

Susan M. Diamond

  03/01/2021   375,000   750,000   1,500,000                                 
            
  02/22/2021               1,074   2,687   5,374               379.89   1,047,352 
            
  02/22/2021                           1,099           379.89   413,894 
            
  02/22/2021                               265   376.61   379.89   24,212 
            
  02/22/2021                               4,259   376.61   379.89   390,349 
            
  08/01/2021                           933           425.86   399,954 
            
   08/01/2021                               3,793   428.6767   425.86   406,673 
            

Brian A. Kane

  03/01/2021   382,500   765,000   1,530,000                                 
            
  02/22/2021               2,249   5,623   11,246               379.89   2,191,870 
            
  02/22/2021                           2,300           379.89   866,203 
            
  02/22/2021                               265   376.61   379.89   24,212 
            
   02/22/2021                               9,201   376.61   379.89   840,648 
            

T. Alan Wheatley

  03/01/2021   332,500   665,000   1,330,000                                 
            
  02/22/2021               1,612   4,031   8,062               379.89   1,571,217 
            
  02/22/2021                           1,649           379.89   621,030 
            
  02/22/2021                               265   376.61   379.89   24,212 
            
   02/22/2021                               6,521   376.61   379.89   595,790 
            

Timothy S. Huval

  03/01/2021   331,500   663,000   1,326,000                                 
            
  02/22/2021               1,188   2,972   5,944               379.89   1,158,452 
            
  02/22/2021                           1,216           379.89   457,958 
            
  02/22/2021         ��                     265   376.61   379.89   24,212 
            
   02/22/2021                               4,738   376.61   379.89   432,886 
            

William K. Fleming

  03/01/2021   280,000   560,000   1,120,000                                 
            
  02/22/2021               1,142   2,855   5,710               379.89   1,112,883 
            
  02/22/2021                           1,168           379.89   439,880 
            
  02/22/2021                               265   376.61   379.89   24,212 
            
   02/22/2021                               4,542   376.61   379.89   414,979 

  Name

  (a)

 

Grant
Date

(b)

  Estimated Possible Payouts
Under Non-Equity Incentive
Plan Awards(1)
  

 

Estimated Future Payouts
Under Equity Incentive
Plan
Awards(2)

  

 

All
Other

Stock

Awards:

Number

of
Shares

of
Stock

or Units

(#)(3)

(i)

  

All

Other

Option

Awards:

Number of

Securities

Underlying

Options

(#)(4)

(j)

  

Exercise

or Base

Price

of

Option

Awards

($/Sh)(5)
(k-1)

  

Closing
Market
Price
on
Grant
Date
($/Sh)

(k-2)

  

Grant
Date Fair
Value of
Stock
and
Option
Awards
($)(6)

(l)

 
 

 

Threshold
($)

(c)

  

 

Target
($)

(d)

  

 

Maximum
($)

(e)

  

 

Threshold
(#)

(f)

  

 

Target
(#)

(g)

  

 

Maximum
(#)

(h)

 
            

Bruce D. Broussard

  03/01/2023   1,500,000   3,000,000   6,000,000                                 
            
  02/24/2023               5,487   13,719   27,438               507.42     
            
  02/24/2023                           6,859           507.42     
            
  02/24/2023                               195   510.2425   507.42   25,718 
            
   02/24/2023                               26,289   510.2425   507.42   3,467,156 
            

Susan M. Diamond

  03/01/2023   400,000   800,000   1,600,000                                 
            
  02/24/2023               1,411   3,528   7,056               507.42     
            
  02/24/2023                           1,764           507.42     
            
  02/24/2023                               195   510.2425   507.42   25,718 
            
   02/24/2023                               6,615   510.2425   507.42   872,427 

68

Humana | 2024 Proxy Statement Executive Compensation


  Name

  (a)

 

Grant
Date

(b)

  Estimated Possible Payouts
Under Non-Equity Incentive
Plan Awards(1)
  

 

Estimated Future Payouts
Under Equity Incentive
Plan
Awards(2)

  

 

All
Other

Stock

Awards:

Number

of
Shares

of
Stock

or Units

(#)(3)

(i)

  

All

Other

Option

Awards:

Number of

Securities

Underlying

Options

(#)(4)

(j)

  

Exercise

or Base

Price

of

Option

Awards

($/Sh)(5)
(k-1)

  

Closing
Market
Price
on
Grant
Date
($/Sh)

(k-2)

  

Grant
Date Fair
Value of
Stock
and
Option
Awards
($)(6)

(l)

 
 

 

Threshold
($)

(c)

  

 

Target
($)

(d)

  

 

Maximum
($)

(e)

  

 

Threshold
(#)

(f)

  

 

Target
(#)

(g)

  

 

Maximum
(#)

(h)

 
            

Sanjay K. Shetty, M.D.

  04/01/2023   337,500   675,000   1,350,000                                 
            
  04/01/2023               738   1,847   3,694               485.46     
            
  04/01/2023                           924           485.46     
            
  04/01/2023                               615   487.1602   485.46   69,792 
            
   04/01/2023                               3,349   487.1602   485.46   380,053 
            

Joseph C. Ventura

  03/01/2023   345,000   690,000   1,380,000                                 
            
  02/24/2023               862   2,156   4,312               507.42     
            
  02/24/2023                           1,078           507.42     
            
  02/24/2023                               195   510.2425   507.42   25,718 
            
   02/24/2023                               3,967   510.2425   507.42   523,193 
            

George Renaudin II

  03/01/2023   337,500   675,000   1,350,000                                 
            
  02/24/2023               862   2,156   4,312               507.42     
            
  02/24/2023                           1,078           507.42     
            
  02/24/2023                               585   510.2425   507.42   77,153 
            
   02/24/2023                               3,577   510.2425   507.42   471,757 

(1)

Amounts calculated based upon annualized base salary, rather than actual amounts paid, for 2021.2023. The actual payment of incentive compensation is shown in the Non-Equity Incentive Plan Compensation column of the Summary Compensation Table under “Executive Compensation” in this proxy statement. In 2021,2023, for our CEO, the threshold, target and maximum opportunity, as a percentage of base salary, were 88%100%, 175%200% and 350%400%, respectively, and for our other Named Executive Officers, were 50%, 100% and 200%. As further explained in the section entitled, “Compensation, Discussion and Analysis — Plan Design and Award Decisions — Short-Term Incentives — 2023 AIP Performance Results” in this proxy statement, for 2023, the actual payment of non-equity incentive compensation for our Named Executive Officers was $0.

68

Humana  |  2022 Proxy Statement  Executive Compensation


(2)

In 2021,2023, our Named Executive Officers were awarded 55%50% of their equity awards in the form of performance-based restricted stock units, with performance criteria based upon three-year cumulative goals with a financial measure of adjusted return on invested capital (ROIC)earnings per share (EPS) and modifier based on three-year relative total stockholdershareholder return (rTSR) of the Company relative to the TSR of the Company’s peer group over the same period. The performance-based units generally vest three years from the date of grant to the extent that the underlying performance targets have been met and the Named Executive Officer continues to be employed through the applicable vesting date.

(3)

In 2021,2023, our Named Executive Officers were awarded 22.5%25% of their equity grants in the form of time-based restricted stock units. The restricted stock units generally vest in equal annual one-third installments beginning in the year of grant, to the extent the Named Executive Officer continues to be employed through the applicable vesting date.

(4)

In 2021,2023, our Named Executive Officers were awarded 22.5%25% of their equity grants in the form of stock options. Stock options awarded to our Named Executive Officers are incentive stock options to the extent allowed by regulation and the balance are treated as nonqualified stock options. Stock options granted to our Named Executive Officers vest and become exercisable in equal annual one-third installments from the date of grant. The above options expire seven years from the date of grant. The exercise price may be paid in cash or, at the discretion of the Committee, in Shares of our common stock valued at the fair market value on the date of exercise or any combination thereof. Under our Stock Plan, the Board may not reduce the exercise price for options or stock appreciation rights by re-pricing or replacing any option award.

(5)

Options under our Stock Plan cannot be granted at less than the Fair Market Value, defined in our Stock Plan as the average of the highest and lowest reported sales prices of our common stock in transactions reported on the composite tape by the NYSE on the grant date. Our Stock Plan was approved by our Board of Directors and by our stockholders.

(6)

Discloses the aggregate grant date fair value of restricted stock unit awards and stock option awards granted in the fiscal year, calculated in accordance with FASB ASC Topic 718, “Compensation — Stock Compensation.” Performance-based restricted stock unit awards are disclosed at target value, based upon the probable outcome of the performance conditions.

 

Executive Compensation  2022 2024 Proxy Statement | Humana

 

     69


Outstanding Equity Awards at Fiscal Year-End

The following table provides information on the stock option, restricted stock units and performance-based restricted stock unit holdings of our Named Executive Officers as of December 31, 2021.2023.

 

    
 Option AwardsStock Awards  Option AwardsOption AwardsStock AwardsStock Awards
   
Name
(a)
Number of
Securities
Underlying
Unexercised
Options
(#)
Exercisable
(b)
Number of
Securities
Underlying
Unexercised
Options
(#)
Unexercisable
(c)
Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options
(#)
(d)
Option
Exercise
Price
($/Sh)
(e)
Option
Expiration
Date
(f)
Number
of Shares
or Units
of Stock
That
Have
Not
Vested
(#)
(g)
Market
Value of
Shares or
Units of
Stock That
Have Not
Vested
($)
(h)
(13)
Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares,
Units or
Other
Rights
That Have
Not Vested
(#)
N/A
(i)
Equity
Incentive
Plan
Awards:
Market or
Payout
Value of
Unearned
Shares, Units
or Other
Rights That
Have Not
Vested
($)
N/A
(j)

Number of
Securities
Underlying
Unexercised
Options
(#)
 Exercisable 

(b)

Number of
Securities
Underlying
Unexercised
Options
(#)
 Exercisable 

(b)

Number of
Securities
Underlying
Unexercised
Options
(#)
 Unexercisable 

  (c)  

Number of
Securities
Underlying
Unexercised
Options
(#)
 Unexercisable 

  (c)  

Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options
(#)

(d)

Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options
(#)

(d)

Option
Exercise
Price
($/Sh)

(e)

Option
Exercise
Price
($/Sh)

(e)

Option
Expiration
Date

   (f)   

Option
Expiration
Date

   (f)   

Number
of Shares
or Units
of Stock
That
Have
Not
Vested
(#)

  (g)  

Number
of Shares
or Units
of Stock
That
Have
Not
Vested
(#)

  (g)  

Market
Value of
Shares or
Units of
Stock That
Have Not
Vested
($)

  (h)(14)  

Market
Value of
Shares or
Units of
Stock That
Have Not
Vested
($)

  (h)(14)  

Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares,
Units or
Other
Rights
That Have
Not Vested
(#)
N/A

   (i)   

Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares,
Units or
Other
Rights
That Have
Not Vested
(#)
N/A

   (i)   

Equity
Incentive
Plan
Awards:
Market or
Payout
Value of
Unearned
Shares, Units
or Other
Rights That
Have Not
Vested
($)
N/A

   (j)   

Equity
Incentive
Plan
Awards:
Market or
Payout
Value of
Unearned
Shares, Units
or Other
Rights That
Have Not
Vested
($)
N/A

   (j)   

   

Bruce D. Broussard

 372 0

 

 268.4700 02/19/2025(2) 

 

 

 

 

 13,430 0

 

 

 350.7875 02/24/2027(1) 

 

 

 

 

 

 

 

 

   

 0 13,470

 

 307.9650 02/25/2026(3) 

 

 

 

 

 20,283 10,142

 

 

 376.6100 02/22/2028(2) 

 

 

 

 

 

 

 

 

   

 13,430 26,860

 

 350.7875 02/24/2027(4) 

 

 

 

 

 7,911 15,823

 

 

 425.0550 02/21/2029(4) 

 

 

 

 

 

 

 

 

   

 0 30,425

 

 376.6100 02/22/2028(5) 

 

 

 

 

 0 26,484

 

 

 510.2425 02/24/2030(5) 

 

 

 

 

 

 

 

 

   

 

 

 

 

 

 2,673(9)  1,239,898

 

 

 

 

 

 

 

 

 

 

 

 

 2,184(8)  999,857

 

 

 

 

   

 

 

 

 

 

 4,929(10)  2,286,366

 

 

 

 

 

 

 

 

 

 

 

 

 4,573(11)  2,093,565

 

 

 

 

   

 

 

 

 

 

 

 

 36,530(12)  16,944,806
   

 

 

 

 

 

 

 

 16,035(13)  7,437,995
   

 

 

 

 

 

 

 

 7,228(14)  3,352,781
   

Susan M. Diamond

 1,432 2,866

 

 350.7875 02/24/2027(4) 

 

 

 

 

 0 1,508

 

 

 376.6100 02/22/2028(2) 

 

 

 

 

 

 

 

 

   

 0 4,524

 

 376.6100 02/22/2028(5) 

 

 

 

 

 2,528 1,265

 

 

 428.6767 08/01/2028(3) 

 

 

 

 

 

 

 

 

   

 0 3,793

 

 428.6767 08/01/2028(6) 

 

 

 

 

 1,854 3,708

 

 

 425.0550 02/21/2029(4) 

 

 

 

 

 

 

 

 

   

 

 

 

 

 

 1,023(7)  474,529

 

 

 0 6,810

 

 

 510.2425 02/24/2030(5) 

 

 

 

 

 

 

 

 

   

 

 

 

 

 

 291(8)  134,983

 

 

 

 

 

 

 

 

 

 

 

 

 311(7)  142,379

 

 

 

 

   

 

 

 

 

 

 285(9)  132,200

 

 

 

 

 

 

 

 

 

 

 

 

 512(9)  234,399

 

 

 

 

   

 

 

 

 

 

 733(10)  340,009

 

 

 

 

 

 

 

 

 

 

 

 

 1,176(11)  538,385

 

 

 

 

   

 

 

 

 

 

 933(11)  432,781

 

 

   

 

 

 

 

 

 

 

 1,688(12)  782,996
   

 

 

 

 

 

 

 

 1,710(13)  793,201
   

Sanjay K. Shetty, M.D.

 0 3,964

 

 487.1602 04/01/2030(6) 

 

 

 

 

 

 

 

 

 

 

 

 1,074(14)  498,186  
 

 

 

 

 

 

 

 

 

 

 

 616(12)  282,011

 

 

 

 

Brian A. Kane

 0 3,892

 

 307.9650 02/25/2026(3) 

 

 

 

 

 

 

Joseph C. Ventura

 4,656 0

 

 350.7875 02/24/2027(1) 

 

 

 

 

   

 4,178 8,357

 

 350.7875 02/24/2027(4) 

 

 

 

 

 3,065 1,533

 

 

 376.6100 02/22/2028(2) 

 

 

 

 

 

 

 

 

   

 0 9,466

 

 376.6100 02/22/2028(5) 

 

 

 

 

 1,310 2,622

 

 

 425.0550 02/21/2029(4) 

 

 

 

 

 

 

 

 

   

 

 

 

 

 

 832(9)  385,932

 

 

 0 4,162

 

 

 510.2425 02/24/2030(5) 

 

 

 

 

 

 

 

 

   

 

 

 

 

 

 1,534(10)  711,561

 

 

 

 

 

 

 

 

 

 

 

 

 362(9)  165,727

 

 

 

 

   

 

 

 

 

 

 

 

 10,554(12)  4,895,579

 

 

 

 

 

 

 

 

 

 

 719(11)  329,165

 

 

 

 

   

 

 

 

 

 

 

 

 4,989(13)  2,314,198
   

 

 

 

 

 

 

 

 2,249(14)  1,043,222
 

 

70  

Humana | 20222024 Proxy Statement Executive Compensation

 


   
  Option AwardsStock Awards
         
 Name
 (a)

Number of
Securities
Underlying
Unexercised
Options
(#)
 Exercisable 

(b)

Number of
Securities
Underlying
Unexercised
Options
(#)
 Unexercisable 

  (c)  

Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options
(#)

(d)

Option
Exercise
Price
($/Sh)

(e)

Option
Expiration
Date

   (f)   

Number
of Shares
or Units
of Stock
That
Have
Not
Vested
(#)

  (g)  

Market
Value of
Shares or
Units of
Stock That
Have Not
Vested
($)

  (h)(14)  

Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares,
Units or
Other
Rights
That Have
Not Vested
(#)
N/A

   (i)   

Equity
Incentive
Plan
Awards:
Market or
Payout
Value of
Unearned
Shares, Units
or Other
Rights That
Have Not
Vested
($)
N/A

   (j)   

         

 George Renaudin II

 0 4,162

 

 

 

 510.2425 02/24/2030(5) 

 

 

 

 

 

 

 

 

 

 

 

 

         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 1,241(8)  568,142

 

 

 

 

 

 

         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 230(9)  105,296

 

 

 

 

 

 

         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 609(10)  278,806

 

 

 

 

 

 

         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 719(11)  329,165

 

 

 

 

 

 

         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 1,768(13)  809,409
         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 841(14)  385,018
         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 862(15)  394,633


   
  Option AwardsStock Awards
         
  Name
  (a)
Number of
Securities
Underlying
Unexercised
Options
(#)
Exercisable
(b)
Number of
Securities
Underlying
Unexercised
Options
(#)
Unexercisable
(c)
Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options
(#)
(d)
Option
Exercise
Price
($/Sh)
(e)
Option
Expiration
Date
(f)
Number
of Shares
or Units
of Stock
That
Have
Not
Vested
(#)
(g)
Market
Value of
Shares or
Units of
Stock That
Have Not
Vested
($)
(h)
(13)
Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares,
Units or
Other
Rights
That Have
Not Vested
(#)
N/A
(i)
Equity
Incentive
Plan
Awards:
Market or
Payout
Value of
Unearned
Shares, Units
or Other
Rights That
Have Not
Vested
($)
N/A
(j)
         

  T. Alan Wheatley

 459 0

 

 

 

 217.4150 03/08/2024(1) 

 

 

 

 

 

 

 

 

 

 

 

 

         

 

 372 0

 

 

 

 268.4700 02/19/2025(2) 

 

 

 

 

 

 

 

 

 

 

 

 

         

 

 5,268 2,634

 

 

 

 307.9650 02/25/2026(3) 

 

 

 

 

 

 

 

 

 

 

 

 

         

 

 2,865 5,730

 

 

 

 350.7875 02/24/2027(4) 

 

 

 

 

 

 

 

 

 

 

 

 

         

 

 0 6,786

 

 

 

 376.6100 02/22/2028(5) 

 

 

 

 

 

 

 

 

 

 

 

 

         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 570(9)  264,400

 

 

 

 

 

 

         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 1,100(10)  510,246

 

 

 

 

 

 

         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 7,144(12)  3,313,816
         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 3,421(13)  1,586,865
         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 1,612(14)  747,743
         

  Timothy S. Huval

 0 2,036

 

 

 

 307.9650 02/25/2026(3) 

 

 

 

 

 

 

 

 

 

 

 

 

         

 

 2,029 4,059

 

 

 

 350.7875 02/24/2027(4) 

 

 

 

 

 

 

 

 

 

 

 

 

         

 

 0 5,003

 

 

 

 376.6100 02/22/2028(5) 

 

 

 

 

 

 

 

 

 

 

 

 

         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 404(9)  187,399

 

 

 

 

 

 

         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 811(10)  376,190

 

 

 

 

 

 

         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 5,520(12)  2,560,508
         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 2,423(13)  1,123,933
         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 1,188(14)  551,066
         

  William K. Fleming

 4,789 2,395

 

 

 

 307.9650 02/25/2026(3) 

 

 

 

 

 

 

 

 

 

 

 

 

         

 

 2,148 4,298

 

 

 

 350.7875 02/24/2027(4) 

 

 

 

 

 

 

 

 

 

 

 

 

         

 

 0 4,807

 

 

 

 376.6100 02/22/2028(5) 

 

 

 

 

 

 

 

 

 

 

 

 

         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 428(9)  198,532

 

 

 

 

 

 

         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 779(10)  361,347

 

 

 

 

 

 

         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 6,494(12)  3,012,307
         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 2,566(13)  1,190,265
         

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 1,142(14)  529,729

(1)

Options granted on March 8, 2017, that vested fully three years from the date of grant.

(2)

Options granted on February 19, 2018, that vested ratably over three years with full vesting on February 19, 2021.

(3)

Options granted on February 25, 2019, vesting ratably over three years with full vesting on February 25, 2022.

(4)

Options granted on February 24, 2020, vesting ratably over three years with full vesting on February 24, 2023.

(5)(2)

Options granted on February 22, 2021, vesting ratably over three years with full vesting on February 22, 2024.

(6)(3)

Options granted on August 1, 2021, vesting ratably over three years with full vesting on August 1, 2024.

(7)(4)

Restricted stock units awardedOptions granted on June 1, 2019, vesting in full on June 1, 2022.

(8)

Restricted stock units awarded on July 1, 2019,February 21, 2022, vesting ratably over three years with full vesting on July 1, 2022.February 21, 2025.

(9)(5)

Restricted stock units awardedOptions granted on February 24, 2020,2023, vesting ratably over three years with an initial tranche vested on December 15, 2020, and full vesting on December 15, 2022.February 24, 2026.

(10)(6)

Restricted stock units awardedOptions granted on February 22, 2021,April 1, 2023, vesting ratably over three years with an initial tranche vested on December 15, 2021, and full vesting on December 15, 2023.April 1, 2026.

(11)(7)

Restricted stock units awarded on August 1, 2021, vesting ratably over three years with an initial tranche vesting on August 1, 2022, and full vesting on August 1, 2023.2024.

(12)(8)

Performance-based restrictedRestricted stock units awarded on February 25, 2019, vesting fully on February 25, 2022. The number of Shares reported is based upon achievement of maximum performance goals.

(13)

Performance-based restricted stock units awarded on February 24, 2020,September 1, 2021, vesting fully three years from the date of grant. The number of Shares reported is based upon achievement of target performance goals.

(14)(9)

Restricted stock units awarded on February 21, 2022, vesting ratably over three years with an initial tranche vested on December 15, 2022, and full vesting on December 15, 2024.

(10)

Restricted stock units awarded on October 1, 2022, vesting fully three years from the date of grant.

(11)

Restricted stock units awarded on February 24, 2023, vesting ratably over three years with an initial tranche vested on December 15, 2023, and full vesting on December 15, 2025.

(12)

Restricted stock units awarded on April 1, 2023, vesting ratably over three years with an initial tranche vested on December 15, 2023, and full vesting on December 15, 2025.

(13)

Performance-based restricted stock units awarded on February 22, 2021, vesting fully three years from the date of grant. The number of Shares reported is based upon achievement of maximum performance goals.

(14)

Performance-based restricted stock units awarded on February 21, 2022, vesting fully three years from the date of grant. The number of Shares reported is based upon achievement of target performance goals.

(15)

Performance-based restricted stock units awarded on February 24, 2023, vesting fully three years from the date of grant. The number of Shares reported is based upon achievement of threshold performance goals.

(15)(16)

Performance-based restricted stock units awarded on April 1, 2023, vesting fully three years from the date of grant. The number of Shares reported is based upon achievement of threshold performance goals.

(17)

Based on the closing stock price on December 31, 202129, 2023 of $463.86.$457.81.

 

Executive Compensation  2022 2024 Proxy Statement | Humana

 

     71


Option Exercises and Stock Vested

The following table provides information on the stock options exercised by, and Shares acquired upon the vesting of restricted stock units held by, our Named Executive Officers in 2021.2023. Options exercised or vested restricted stock units may or may not have been sold by a particular Named Executive Officer, and the inclusion in this table of such information should not be understood to imply the actual receipt of monies.

 

 

 

Option Awards

 

 

Stock Awards

 

    

Name

(a)

Number of

Shares

    Acquired on    

Exercise (#)

(b)

    Value Realized    

on Exercise

($)(1)

(c)

Number of

    Shares Acquired    

on Vesting

(#)

(d)

    Value Realized    

on Vesting

($)(2)

(e)

    

Bruce D. Broussard

 41,285 6,788,967 49,154 19,225,940
    

Susan M. Diamond

 0 0 4,017 1,612,655
    

Brian A. Kane

 19,823 2,987,295 13,651 5,356,284
    

T. Alan Wheatley

 3,224 605,871 9,151 3,595,101
    

Timothy S. Huval

 4,243 641,771 7,415 2,903,142
    

William K. Fleming

 8,014 1,498,256 8,795 3,431,394
 

 

Option Awards

 

 

Stock Awards

 

    

Name

(a)

Number of
Shares
 Acquired on 
Exercise (#)

(b)

Value Realized

on Exercise

($)(1)

(c)

Number of
 Shares Acquired 

on Vesting

(#)

(d)

Value Realized
on Vesting

($)(2)

(e)

    

Bruce D. Broussard

 —  —  35,429 17,753,777
    

Susan M. Diamond

 3,369 555,292 4,817 2,373,179
    

Sanjay K. Shetty, M.D.

 —  —  308 142,783
    

Joseph C. Ventura

 —  —  4,387 2,187,385
    

George Renaudin II

 —  —  2,222 1,095,076

(1)

The Value Realized on Exercise is based on the difference between the Fair Market Value of our common stock as reported by the NYSE composite tape and the exercise price of the options on the date of exercise.

(2)

The Value Realized on Vesting is based on the Fair Market Value of our common stock as reported on the composite tape by the NYSE on the date of vesting.

Nonqualified Deferred Compensation

The following table and narrative that follows provides information on contributions and earnings for the Humana Retirement Equalization Plan and the Humana Deferred Compensation Plan for the Named Executive Officers in 2021.2023.

 

     

Name

(a)

 

Executive
    Contributions in    

Last FY

($)

(b)

 

Registrant
    Contributions in    

Last FY

($)

(c)(1)

 

Aggregate
    Earnings in    

Last FY

($)

(d)

 

Aggregate

    Withdrawals/    

Distributions

($)

(e)

 

Aggregate
    Balance at    

Last FYE

($)

(f)

     

Bruce D. Broussard

      326,361   300,480      3,236,715
     

Susan M. Diamond

      79,703   29,898      333,460
     

Brian A. Kane

      113,821   96,224      887,657
     

T. Alan Wheatley

      92,892   142,425      1,054,312
     

Timothy S. Huval

      95,745   6,700      734,163
     

William K. Fleming

      77,608   34,136      1,265,477
     

Name

(a)

 

Executive
 Contributions in 

Last FY

($)

(b)

 

Registrant
 Contributions in 

Last FY

($)

(c)(1)

 

Aggregate
 Earnings in 

Last FY

($)

(d)

 

Aggregate

 Withdrawals/ 

Distributions

($)

(e)

 

Aggregate
 Balance at 

Last FYE

($)

(f)

     

Bruce D. Broussard

      315,922   478,404      3,792,047
     

Susan M. Diamond

      107,681   25,440      532,795
     

Sanjay K. Shetty, M.D.

      —    —       — 
     

Joseph C. Ventura

      84,911   43,394      370,028
     

George Renaudin II

      59,559   116,568      999,517

(1)

The amounts listed above under Registrant Contributions in Last Fiscal Year (column c) are also included under the All“All Other CompensationCompensation” column of the Summary Compensation Table in this proxy statement.

We have a 401(k) plan, the Humana Retirement Savings Plan, and a nonqualified, unfunded, defined contribution plan, the Humana Retirement Equalization Plan. The Internal Revenue Code imposes limitations on the contributions that may be made to a qualified plan, like our Humana Retirement Savings Plan. In 2021,2023, once an individual is paid $290,000$330,000 in compensation, both individual and Company contributions to the Pretax Savings Account of the Humana Retirement Savings Plan must cease. Any Company matching contributions that would have been made to the Pretax Savings Account of the Humana Retirement Savings Plan are credited to the Pretax Savings Account of the Humana Retirement Equalization Plan.

The benefits accrued under the Humana Retirement Equalization Plan are those Company contributions that cannot be made to the qualified Humana Retirement Savings Plan because of the IRS limitations. The maximum percentage of compensation (base salary and

72

Humana  |  2022 Proxy Statement  Executive Compensation


incentive compensation) that can be contributed by a highly compensated employee to the Humana Retirement Savings Plan is 35% for 2021.2023. The Company matches 125% of the first 6% of employee salary deferrals. Effective January 1, 2023, an employee must complete a year of service before being eligible for the Company’s match. Accruals under the Humana Retirement Equalization Plan, which is

72

Humana | 2024 Proxy Statement Executive Compensation


unfunded, are deemed to be invested in the accounts selected by the participants. The Humana Retirement Equalization Plan allows daily rebalancing of funds and allows direction of investment elections. Benefits in the Humana Retirement Equalization Plan, as directed by the participants, are distributable upon termination of employment, death, total disability, retirement or a change in control of the Company. Distribution of benefits may take the form of a lump sum payment or periodic installments not to exceed twenty (20) years — if the Humana Retirement Equalization Plan balance exceeds $100,000. All of the Named Executive Officers, except Mr. Broussard (who elected installments for 10 years following termination) and Mr. Renaudin (who elected installments for 2 years following termination), eligible for a contribution under the Humana Retirement Equalization Plan in 20212023 will receive a lump sum payment upon termination.

We also maintain a Humana Deferred Compensation Plan, which is designed to provide certain key employees of the Company and its subsidiaries with the opportunity to defer receipt of a portion of certain incentive compensation to which they may become entitled while the plan is in effect. The Humana Deferred Compensation Plan is an unfunded, nonqualified deferred compensation plan that is maintained for the purpose of allowing deferred compensation to certain highly-compensatedhighly compensated employees, within the meaning of Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA, whose annual rate of base compensation exceeds the limitation provided in IRS Code Section 401(a)(17) for the plan year. For 2021,2023, participants may elect to have the payment of up to 80% of his or her incentive compensation for a plan year deferred pursuant to the Humana Deferred Compensation Plan; provided, that such amount must be equal to or greater than $25,000. If a participant’s deferral election results in a deferral amount of less than $25,000, then the deferral amount shall be zero. Deferral elections under the Humana Deferred Compensation Plan are made annually and are irrevocable. The deferral account accrues interest using the established two-year U.S. Treasury note rate. Distributions from the Humana Deferred Compensation Plan are distributable upon the payment commencement date, as determined upon the participant’s deferral election, which may be (i) the date that is six months following the date of the participant’s separation from the Company; (ii) a date specified by the participant in his or her deferral election; or (iii) the earlier of either the date that is six months following the date of (i) or (ii). Distributions may take the form of a lump sum payment or periodic installments (quarterly or annually) not to exceed ten (10) years — if the deferral balance is less than $100,000, then payment will be made in lump sum regardless of the participant’s election. Mr. Fleming is the onlyDuring 2023, none of our Named Executive Officer who hasOfficers participated in the Humana Deferred Compensation Plan, however he made no contributions during 2021. Mr. Fleming’s 2021 accrued earnings of $1,947 and 2021 deferral account balance of $230,239 are each included within the table above under column (d) and column (f), respectively.Plan.

Executive Compensation  2022 Proxy Statement  |  Humana

73


Potential Payments Upon Termination or Change in Control of the Company

In accordance with our past disclosure practice, the table below discloses amounts payable to our Named Executive Officers under various scenarios had such occurred as of December 31, 2021.2023. The Named Executive Officers would each receive certain payments upon termination from the Company which vary in amount depending on the reason for termination. Each Named Executive Officer would also receive a specified payment in connection with a change in control of the Company. The table below provides dollar amounts for all potential payments that would be paid by us to each Named Executive Officer under various scenarios involving either a termination or a change in control. The payments to our Named Executive Officers are governed by the various agreements or arrangements described in the footnotes to the table. The timing of the payments described below to the Named Executive Officers may also be subject to the provisions of Section 409A which may delay payment.

 

      

Name and Form of Payment

 Voluntary
Termination
$ (a)
  Involuntary
Termination
without
Cause
$ (b)
  Involuntary
Termination
for Cause
$ (c)
  Retirement(6)
$ (d)
  Death or
Disability
(2)
$ (e)
  Change in
Control
(3)
$ (f)
 
      

Bruce D. Broussard

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

      

  Severance(1)

  0   7,422,250   0   0   0   9,277,813 
      

  Life, Health & Other Benefits(7)

  0   0   0   0   0   56,717 
      

  Stock Options (accelerated)(2)(4)

  0   0   0   0   7,932,417   7,932,417 
      

  Restricted Stock Units (accelerated)(2)(4)

  0   0   0   0   27,938,888   27,938,888 
      

  Subtotal: Termination Related Payments

  0   7,422,250   0   0   35,871,305   45,205,835 
      

  Stock Options (vested)(2)(4)

  1,618,715   1,618,715   0   1,618,715   1,618,715   1,618,715 
      

  Supplemental Retirement Plan(5)

  3,236,715   3,236,715   3,236,715   3,236,715   3,236,715   3,236,715 
      

Subtotal: Currently Vested Amounts

  4,855,430   4,855,430   3,236,715   4,855,430   4,855,430   4,855,430 
      

  Mr. Broussard’s Totals

  4,855,430   12,277,680   3,236,715   4,855,430   40,726,735   50,061,265 
      

Susan M. Diamond

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

      

  Severance(1)

  0   1,125,000   0   0   0   3,000,000 
      

  Life, Health & Other Benefits(7)

  0   0   0   0   0   37,310 
      

  Stock Options (accelerated)(2)

  0   0   0   0   874,489   874,489 
      

  Restricted Stock Units (accelerated)(2)

  0   0   0   0   3,962,520   3,962,520 
      

  Subtotal: Termination Related Payments

  0   1,125,000   0   0   4,837,009   7,874,319 
      

  Stock Options (vested)(2)

  164,770   164,770   0   164,770   164,770   164,770 
      

  Supplemental Retirement Plan(5)

  333,460   333,460   333,460   333,460   333,460   333,460 
      

Subtotal: Currently Vested Amounts

  498,230   498,230   333,460   498,230   498,230   498,230 
      

  Ms. Diamond’s Totals

  498,230   1,623,230   333,460   498,230   5,335,239   8,372,549 
      

T. Alan Wheatley

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

      

  Severance(1)

  0   997,500   0   0   0   2,660,000 
      

  Life, Health & Other Benefits(7)

  0   0   0   0   0   52,894 
      

  Stock Options (accelerated)(2)

  0   0   0   0   1,680,760   1,680,760 
   ��  

  Restricted Stock Units (accelerated)(2)

  0   0   0   0   5,913,500   5,913,500 
      

  Subtotal: Termination Related Payments

  0   997,500   0   0   7,594,260   10,307,154 
      

  Stock Options (vested)(2)

  1,348,849   1,348,849   0   1,348,849   1,348,849   1,348,849 
      

  Supplemental Retirement Plan(5)

  1,054,312   1,054,312   1,054,312   1,054,312   1,054,312   1,054,312 
      

Subtotal: Currently Vested Amounts

  2,403,161   2,403,161   1,054,312   2,403,161   2,403,161   2,403,161 
      

  Mr. Wheatley’s Totals

  2,403,161   3,400,661   1,054,312   2,403,161   9,997,421   12,710,315 
      

Name and Form of Payment

 Voluntary
Termination
$ (a)
  Involuntary
Termination
without
Cause
(1)
$ (b)
  Involuntary
Termination
for Cause
$ (c)
  Retirement(5)
$ (d)
  Death or
Disability
(2)
$ (e)
  Change in
Control
(3)
$ (f)
 
      

Bruce D. Broussard

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

      

  Severance

  0   9,000,000   0   0   0   11,250,000 
      

  Life, Health & Other Benefits(6)

  0   0   0   0   0   57,385 
      

  Stock Options (accelerated)(2)

  0   0   0   0   1,318,444   1,318,444 
      

  Restricted Stock Units (accelerated)(2)

  0   0   0   0   24,972,490   24,972,490 
      

  Subtotal: Termination Related Payments

  0   9,000,000   0   0   26,290,934   37,598,319 
      

  Stock Options (vested)(2)

  3,305,955   3,305,955   0   3,305,955   3,305,955   3,305,955 
      

  Supplemental Retirement Plan(4)

  3,792,047   3,792,047   3,792,047   3,792,047   3,792,047   3,792,047 
      

Subtotal: Currently Vested Amounts

  7,098,002   7,098,002   3,792,047   7,098,002   7,098,002   7,098,002 
      

  Mr. Broussard’s Totals

  7,098,002   16,098,002   3,792,047   7,098,002   33,388,936   44,696,321 

 

74

Executive Compensation 2024 Proxy Statement | Humana

 73


      

Name and Form of Payment

 Voluntary
Termination
$ (a)
  Involuntary
Termination
without
Cause
(1)
$ (b)
  Involuntary
Termination
for Cause
$ (c)
  Retirement(5)
$ (d)
  Death or
Disability
(2)
$ (e)
  Change in
Control
(3)
$ (f)
 
      

Susan M. Diamond

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

      

  Severance

  0   1,200,000   0   0   0   3,200,000 
      

  Life, Health & Other Benefits(6)

  0   0   0   0   0   38,335 
      

  Stock Options (accelerated)(2)

  0   0   0   0   274,926   274,926 
      

  Restricted Stock Units (accelerated)(2)

  0   0   0   0   7,650,333   7,650,333 
      

  Subtotal: Termination Related Payments

  0   1,200,000   0   0   7,925,259   11,163,594 
      

  Stock Options (vested)(2)

  130,433   130,433   0   130,433   130,433   130,433 
      

  Supplemental Retirement Plan(4)

  532,795   532,795   532,795   532,795   532,795   532,795 
      

Subtotal: Currently Vested Amounts

  663,228   663,228   532,795   663,228   663,228   663,228 
      

  Ms. Diamond’s Totals

  663,228   1,863,228   532,795   663,228   8,588,487   11,826,822 
      

Sanjay K. Shetty, M.D.

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

      

  Severance

  0   1,012,500   0   0   0   2,700,000 
      

  Life, Health & Other Benefits(6)

  0   0   0   0   0   9,340 
      

  Stock Options (accelerated)(2)

  0   0   0   0   0   0 
      

  Restricted Stock Units (accelerated)(2)

  0   0   0   0   1,127,032   1,127,032 
      

  Subtotal: Termination Related Payments

  0   1,012,500   0   0   1,127,032   3,836,372 
      

  Stock Options (vested)(2)

  0   0   0   0   0   0 
      

  Supplemental Retirement Plan(4)

  0   0   0   0   0   0 
      

Subtotal: Currently Vested Amounts

  0   0   0   0   0   0 
      

  Dr. Shetty’s Totals

  0   1,012,500   0   0   1,127,032   3,836,372 
      

Joseph C. Ventura

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

      

  Severance

  0   1,035,000   0   0   0   2,760,000 
      

  Life, Health & Other Benefits(6)

  0   0   0   0   0   53,879 
      

  Stock Options (accelerated)(2)

  0   0   0   0   206,624   206,624 
      

  Restricted Stock Units (accelerated)(2)

  0   0   0   0   3,945,807   3,945,807 
      

  Subtotal: Termination Related Payments

  0   1,035,000   0   0   4,152,431   6,966,310 
      

  Stock Options (vested)(2)

  781,956   781,956   0   781,956   781,956   781,956 
      

  Supplemental Retirement Plan(4)

  370,028   370,028   370,028   370,028   370,028   370,028 
      

Subtotal: Currently Vested Amounts

  1,151,984   1,151,984   370,028   1,151,984   1,151,984   1,151,984 
      

  Mr. Ventura’s Totals

  1,151,984   1,886,640   370,028   1,151,984   5,304,415   8,118,294 
      

George Renaudin II

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

      

  Severance

  0   1,012,500   0   0   0   2,700,000 
      

  Life, Health & Other Benefits(6)

  0   0   0   0   0   53,969 
      

  Stock Options (accelerated)(2)

  0   0   0   0   0   0 
      

  Restricted Stock Units (accelerated)(2)

  0   0   0   0   3,055,652   3,055,652 
      

  Subtotal: Termination Related Payments

  0   1,012,500   0   0   3,055,652   5,809,621 
      

  Stock Options (vested)(2)

  0   0   0   0   0   0 
      

  Supplemental Retirement Plan(4)

  999,517   999,517   999,517   999,517   999,517   999,517 
      

Subtotal: Currently Vested Amounts

  999,517   999,517   999,517   999,517   999,517   999,517 
      

  Mr. Renaudin’s Totals

  999,517   1,886,640   999,517   999,517   4,055,169   6,809,138 

74 

Humana | 20222024 Proxy Statement Executive Compensation

 



      

Name and Form of Payment(8)

 Voluntary
Termination
$ (a)
  Involuntary
Termination
without
Cause
$ (b)
  Involuntary
Termination
for Cause
$ (c)
  Retirement(6)
$ (d)
  Death or
Disability
(2)
$ (e)
  Change in
Control
(3)
$ (f)
 
      

Timothy S. Huval

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

      

  Severance(1)

  0   975,000   0   0   0   2,600,000 
      

  Life, Health & Other Benefits(7)

  0   0   0   0   0   52,870 
      

  Stock Options (accelerated)(2)

  0   0   0   0   1,234,960   1,234,960 
      

  Restricted Stock Units (accelerated)(2)

  0   0   0   0   4,365,015   4,365,015 
      

  Subtotal: Termination Related Payments

  0   975,000   0   0   5,599,975   8,252,845 
      

  Stock Options (vested)(2)

  233,462   233,462   0   233,462   233,462   233,462 
      

  Supplemental Retirement Plan(5)

  734,163   734,163   734,163   734,163   734,163   734,163 
      

Subtotal: Currently Vested Amounts

  967,625   967,625   734,163   967,625   967,625   967,625 
      

  Mr. Huval’s Totals

  967,625   1,942,625   734,163   967,625   6,567,600   9,220,470 
      

William K. Fleming

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

  

 

 

 

 

 

      

  Severance(1)

  0   840,000   0   0   0   2,240,000 
      

  Life, Health & Other Benefits(7)

  0   0   0   0   0   51,696 
      

  Stock Options (accelerated)(2)

  0   0   0   0   1,301,650   1,301,650 
      

  Restricted Stock Units (accelerated)(2)

  0   0   0   0   4,600,269   4,600,269 
      

  Subtotal: Termination Related Payments

  0   840,000   0   0   5,901,919   8,193,615 
      

  Stock Options (vested)(2)

  1,003,266   1,003,266   0   1,003,266   1,003,266   1,003,266 
      

  Supplemental Retirement Plan(5)

  1,265,477   1,265,477   1,265,477   1,265,477   1,265,477   1,265,477 
      

Subtotal: Currently Vested Amounts

  2,268,743   2,268,743   1,265,477   2,268,743   2,268,743   2,268,743 
      

  Mr. Fleming’s Totals

  2,268,743   3,108,743   1,265,477   2,268,743   8,170,662   10,462,358 

(1) Severance Policy

We have a Severance Policy that covers all of our Named Executive Officers, or NEOs. Under the Severance Policy our NEOs, if involuntarily terminated for reasons not meeting the definition of Cause, would receive salary continuation during the Severance Period (24 months for the CEO; eighteen (18) months for other NEOs) following the termination date at their respective Severance Rate. The Severance Rate for all NEOs is equal to their then current Annual Base Salary, with the CEO’s Severance Rate also including the target annual incentive compensation calculated as if goals had been met during the Company’s then-current fiscal year, pursuant to the relevant incentive compensation plan. All other terminated Named Executive Officers would remain eligible to receive prorated incentive compensation to be paid at the normal time after year end, provided plan targets and other plan provisions were met. The calculations in the table assume a December 31, 20212023 termination and the prior payment in full of incentive compensation forearned in the full year atof termination, such that the target threshold.incentive compensation payment in connection with an involuntary termination without cause is $0.

Under the terms of the Severance Policy, each Named Executive Officer is required to enter into a written agreement containing certain restrictive covenants, including, non-compete and non-solicitation provisions as well as provisions relating to non-disparagement and cooperation, in each case for the duration of the applicable Severance Period.

(2) Stock Option and Restricted Stock Unit Agreements

At December 31, 2021,2023, the NEOs have stock options and restricted stock units (with both time-based and performance-based vesting) outstanding under our Stock Plan. The treatment of these equity awards will vary depending upon the nature of the termination. The amounts disclosed in the table assume treatment of stock options and restricted stock units based on the December 31, 202129, 2023 fair market value of $465.85.$456.9132.

Voluntary Termination. Under the Stock Plan, upon a voluntary termination for reasons not having to do with Cause or Retirement, in each case as defined below, each NEO would have 90 days to exercise any vested options, but in no event beyond the expiration date. Any unvested stock options held by our NEOs would be forfeited. Any unvested restricted stock units held by our NEOs would also be forfeited upon a voluntary termination for reasons not having to do with Cause or Retirement, in each case as defined below; provided, however, that the Committee may determine, in its sole discretion, that the restrictions on some or all of such unvested restricted stock units shall immediately lapse upon such termination.

Executive Compensation  2022 Proxy Statement  |  Humana

75


Involuntary Termination Without Cause. Under the Stock Plan, upon an involuntary termination by the Company for reasons other than Cause, each NEO would have 90 days to exercise any vested options, but in no event beyond the expiration date. Any unvested stock options held by our NEOs would be forfeited. Any unvested restricted stock units held by our NEOs would also be forfeited. In addition, our equity grant agreements contain non-compete and non-solicit provisions that only remain in full force and effect following an involuntary termination by the Company for reasons other than Cause if we pay an amount at least equal to the NEO’s then current annual base salary. Any such amounts that could be paid post-termination to enforce non-compete and non-solicit provisions are not included in the table above.

Involuntary Termination for Cause. Under the Stock Plan, in the event of termination for Cause, all options and unvested restricted stock units are forfeited for all NEOs, regardless of whether the options are vested. Under the Stock Plan, Cause is defined as “a felony conviction of a Participant or the failure of a Participant to contest prosecution for a felony, or a Participant’s willful misconduct or dishonesty, any of which is determined by the Committee to be directly and materially harmful to the business or reputation of the Company or its Subsidiaries.”

Retirement. Under the Stock Plan, an eligible Retirement means a combination of age and years of service with the Company totaling 65 or greater, with a minimum required age of 55 and a minimum requirement of five years of service. In the event of an eligible Retirement by a NEO, any outstanding options and restricted stock units will vest pro rata on the next scheduled vesting date, and any remaining outstanding options or restricted stock units would then be forfeited.

Death or Disability. Under the Stock Plan, in the event of death or Disability of a NEO, all outstanding options shall become immediately exercisable in full and the NEO, or his estate or representative shall have two years to exercise the options regardless of the expiration date. Under the Stock Plan, in the event of death or Disability of a NEO, any unvested restricted stock units shall immediately vest, and any unvested Shares of performance-based restricted stock units will vest at the target level.

Change in Control. Under the Stock Plan, in the event of a termination other than for Cause or resignation for Good Reason within two years following a Change in Control, (x) all outstanding options shall become immediately exercisable in full and the NEO shall have two years to exercise the options, but in no event beyond the expiration date, and (y) any unvested restricted stock units shall immediately vest, and any unvested Shares of performance-based restricted stock units will vest at the target level.

Executive Compensation 2024 Proxy Statement | Humana

75


(3) Change in Control Policy and Benefits

We have a Change in Control Policy (CIC Policy), as adopted by the Organization & Compensation Committee. For the period ended December 31, 2021,2023, all of our NEOs, including the CEO were eligible under the CIC Policy. The CIC Policy provides certain benefits in the event an eligible employee’s employment is terminated by the Company without Cause or by the employee with Good Reason within twenty-four months following a Change in Control, or by the Company without Cause under certain circumstances prior to a Change in Control. The table assumes treatment of each NEO under the CIC Policy.

Under the CIC Policy for the period ended December 31, 2021,2023, NEOs would be entitled to receive a Cash Severance equal to twice the sum of each individual’s Annual Base Salary, excluding the CEO whose Cash Severance is equal to two and one-half times Annual Base Salary, as well as the target incentive compensation payable to him or her. Assuming a Change in Control and subsequent termination event had occurred at December 31, 2021,2023, the payments set forth in the table above would have been made within fifteen business days of the termination event (or such later date as may be required by Section 409A) by the surviving company in the Change in Control. See the discussion herein under Note 3 regarding Change in Control treatment of equity compensation.

Further, under the CIC Policy, each NEO is entitled to receive all life insurance, health insurance, dental insurance, accidental death and dismemberment insurance and disability insurance under plans and programs in which the NEO and/or the NEO’s dependents and beneficiaries participated immediately prior to the date of termination. These benefits shall continue for 18 months following termination. These benefits are valued at the amounts listed in the table above for the applicable period.

Pursuant to our long-standing Company policy, the CIC Policy does not include an excise tax gross-up provision with respect to payments contingent upon a change in control.

(4) Treatment of Equity Awards Granted to our CEO Prior to 2018

The Company and Mr. Broussard previously had in force an Amended and Restated Employment Agreement, dated as of February 27, 2014, later amended on July 2, 2015 and August 16, 2018, which we refer to herein as the Broussard Agreement. Effective as of January 1, 2019, Mr. Broussard and the Company agreed not to renew the Broussard Agreement, but that certain provisions pertaining to the treatment of equity awards granted prior to December 31, 2018, in the event of termination or change in control, would continue to apply. As of December 31, 2021 such equity treatment provisions only apply to Mr. Broussard’s outstanding and exercisable stock options granted on February 19, 2018 as reported under section entitled “Outstanding Equity Awards at Fiscal Year-End” (the “2018 Outstanding Options”). For all other purposes, Mr. Broussard is governed by the Severance Policy and CIC Policy generally applicable to Company executives as described in Notes 1 and 3 above.

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Humana  |  2022 Proxy Statement  Executive Compensation


The table above discloses potential payments upon termination or a Change in Control that would be owed to Mr. Broussard had such events occurred as of December 31, 2021, and contemplates the separate treatment of the 2018 Outstanding Options. 2018 Outstanding Options that are outstanding on the Termination Date, notwithstanding any contract provision in the applicable award agreement or plan under which the award is granted, shall remain outstanding and exercisable until the earlier of the second anniversary of the Termination Date and the term of the stock option (i) upon a termination of Mr. Broussard’s employment by us without Cause or by Mr. Broussard for Good Reason in circumstances not related to a Change in Control; (ii) upon a Change in Control Termination; or (iii) due to his death or Disability on or after a Change in Control.

(5) Pension and Retirement Plans

In the event of termination, each NEO would receive their account balance under the Humana Retirement Equalization Plan and the Humana Deferred Compensation Plan, as disclosed in the Nonqualified Deferred Compensation table, together with their Humana Retirement Savings Plan benefit. The Humana Retirement Savings Plan is a qualified 401(k) plan generally available to all Humana associates.

The Humana Retirement Savings Plan amounts are payable under various forms of distribution, the specific form to be elected by the participant. The forms of distribution are a single lump sum in cash or our common stock (if invested in the Humana common stock fund); substantially equal monthly, quarterly, or annual installments for a period of 5, 10, 15 or 20 years not to exceed the life expectancy of the participant, or the joint and last survivor expectancy of the participant and a designated beneficiary.

At December 31, 2021,2023, the account balances under the Humana Retirement Savings Plan—which include both the individual’s contribution and the Company’s contributions—for the NEOs are as follows (which amounts are not included in the table above):

 

Bruce D. Broussard

  $854,155  

Susan M. Diamond

  $1,036,752  

T. Alan Wheatley

  $2,103,725  

Timothy S. Huval

  $531,902  

William K. Fleming

  $2,022,599  
  

Bruce D. Broussard

 $956,162 
 

Susan M. Diamond

 $1,198,182 
 

Sanjay K. Shetty, M.D.

 $20,990 
 

Joseph C. Ventura

 $1,080,450 
 

George Renaudin II

 $2,720,908 

(6)(5) Retirement

As noted above, under the Stock Plan, the definition of retirement eligibility means a combination of age and years of service with the Company totaling 65 or greater, with a minimum required age of 55 and a minimum requirement of five years of service. For additional information on the stock options and restricted stock units held by each of our NEOs, please refer to the table entitled, “Outstanding Equity Awards at Fiscal Year End” in this proxy statement. The table above does not include amounts that would be realized from continued vesting of stock option and restricted stock unit awards.

(7)

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Humana | 2024 Proxy Statement Executive Compensation


(6) Life, Health and Other Benefits

Upon termination (other than a termination in connection with a Change in Control as described above), all officers elected by our Board of Directors, including our NEOs, are eligible for continuation of health and dental coverage pursuant to COBRA. Such coverage is not included in the table above (except for a Change in Control, where a two yeartwo-year expense for health benefits is included, assuming a 10% increase in premiums year over year).

In the event of death, the estate of each NEO is entitled to receive a life insurance benefit in the amount of three times the current base salary of the officer (up to a maximum of $3 million), reduced by 50% when the age of 70 has been attained. As of December 31, 2021,2023, the amount payable under such death benefit, which is not included in the table above, is as follows for our NEOs:

 

  

Bruce D. Broussard

 $3,000,000 
 

Susan M. Diamond

 $2,400,000 
 

Sanjay K. Shetty, M.D.

 $2,025,000 
 

Joseph C. Ventura

 $2,070,000 
 

George Renaudin II

 $2,025,000 

CEO Pay Ratio

 

Bruce D. Broussard2023 CEO Pay Ratio

192:1

   $3,000,000  As detailed further within the “Human Capital Management” section of this proxy statement, our associates’ total compensation may include base pay, incentive pay, overtime and other supplemental pay. We regularly review associate compensation and conduct benchmarking of our pay to the external market where we compete for talent, along with internal reviews of associate pay compared to those doing similar work in similar capacities across the Company – all to ensure we are competitive and aligned

with industry standards. With respect to our CEO and other Named Executive Officers, as discussed further within the “Compensation Discussion and Analysis” section of this proxy statement, the Organization & Compensation Committee believes that current levels of compensation are appropriate based on the Committee’s multifaceted review.

Our 2023 CEO pay ratio was calculated in compliance with the requirements set forth in Item 402(u) of Regulation S-K. Outlined below is the process that was applied for identifying our median associate for our comparative compensation analysis of the median associate to our CEO.

 

Susan M. Diamond

   $2,250,000  

T. Alan WheatleyWe identified the median associate using 63,941 global full-time, part-time, temporary and seasonal associates employed as of December 31, 2023, which excludes approximately 2,906 associates who joined us during 2023 as a result of acquisitions and business combinations, as well as 726 associates from the Dominican Republic (representing less than 5% of our associate base) in accordance with SEC rules;

  $1,995,000  

Timothy S. Huval

  $1,989,000  

William K. Fleming

  $1,680,000  

 

We consistently applied 2023 W-2 earnings as the compensation measure for identifying our median associate;

During 2023, our median associate participated in the AIP, as discussed further in this proxy statement under the section titled “Compensation Discussion and Analysis—Plan Design and Award Decisions—Associate Incentive Plan.” The 2023 AIP compensation was not included within the 2023 W-2 earnings, as this cash compensation, although earned for 2023, is payable during 2024. Therefore, to determine the median associate compensation, we applied the final AIP payout of 30% of the target opportunity (based on overall Company performance, as discussed in the above referenced section) to our median associate’s total W-2 compensation. This payout as a percentage of target was consistent across our population of eligible associates, except our CEO and other NEOs, before any adjustments for individual contributions;

We then calculated our median associate’s compensation in the same manner as the Named Executive Officers in the Summary Compensation Table;

Applying this methodology, our median associate’s total compensation was $85,122, which includes a 2023 AIP payment of $1,746; and

Our Chief Executive Officer’s total compensation was $16,327,384.

Executive Compensation  2022 2024 Proxy Statement | Humana

 

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(8) Payments to Mr. Kane in Connection with his Departure

In connection with Mr. Kane’s transition from Chief Financial Officer to a strategic advisor effective as

Pay Versus Performance
As required by Section 953(a) of June 1, 2021, Mr. Kane entered into a Separationthe Dodd-Frank Wall Street Reform and Transition Agreement on March 22, 2021. While serving as a strategic advisor, Mr. Kane continued to receive his base salaryConsumer Protection Act, and was eligible for incentiveItem 402(v) of Regulation
S-K
(the “PvP Rules”), we are providing the following: (1) tabular compensation and benefitsperformance disclosure for 2020, 2021, 2022, and 2023; (2) an unranked list of three performance measures that the Company considers to be its most important measures used to align compensation actually paid to the NEOs for 2023 to Company performance; and (3) additional disclosure relative to the relationship between the “Compensation Actually Paid” (“CAP”) set forth in the Pay versus Performance Table and each of the performance metrics set forth in the Pay versus Performance Table and between the Company’s and the Peer Group TSR, in each case over 2020-2023.
For further information concerning Humana’s variable
pay-for-performance
philosophy and how Humana aligns executive compensation with the Company’s performance, refer to the “Compensation Discussion and Analysis.”
Pay Versus Performance Table
Pursuant to the PvP Rules, the Pay versus Performance Table (set forth below) is required to include for each year the CAP to the CEO and the average CAP for
non-CEO
named executive officers. CAP represents a new calculation of compensation that differs significantly from the Company. Mr. Kane transitionedSummary Compensation Table calculation of compensation, as well as from the way in which the Organization and Compensation Committee views annual compensation decisions, as discussed in the Compensation Discussion and Analysis. For example, the CAP calculation for a given year includes the change in fair value of multiple years of equity grants that are outstanding and unvested during the year, whereas the Summary Compensation Table calculation includes only the grant date fair value of equity awards that are granted during the year. These differences result in a CAP calculation that may be higher or lower than the corresponding Summary Compensation Table calculation, and that also may be more significantly impacted by changes in stock price. It is also important to an advisory rolenote that outstanding equity awards may be represented in order to facilitatemore than one year of the Pay versus Performance Table.
Equity grants (performance-based restricted stock units, restricted stock units and stock options) constitute a smooth transitionmeaningful portion of compensation for the CEO and other NEOs. The value of equity grants will not be realized before applicable restriction periods and/or conditions lapse (including, with respect to the Company’s finance and reporting functions, and continued to provide strategic advisory services to the Company. On February 28, 2022, at the end of the transition period, Mr. Kane’s employment with the Company terminated due to the elimination of his role and, subject to his execution of a general release and compliance with applicable restrictive covenants, Mr. Kane became entitled to the benefits pursuant to the Company’s Executive Severance Policy and stock incentive plans that participants receive in connection with a position elimination. Accordingly, Mr. Kane is entitled to base salary continuation for eighteen (18) months following his termination of employment ($1,147,500) and his outstandingperformance-based restricted stock units, the achievement of
pre-determined
performance goals) and unvested stock options continue to vest for one year following the date that his employment terminated as if Mr. Kane had continued to be employed through the endultimate value of such period. In addition, Mr. Kane continuesawards is subject to be bound by non-competechanges in stock price. While each participant was awarded a target number of performance-based restricted stock units, the actual number of performance-based restricted stock units earned could vary from zero (0) up to two (2) times target, if performance objectives are meaningfully exceeded, and non-solicit covenants duringno participant will receive any portion of performance-based restricted stock units if the applicable severance period.

threshold performance objectives are not met.
       
Year (a)
 
 Summary  
 Compensation  
 Table Total for  
 PEO  
 ($)
(1)
  
 (b)  
  
 Compensation  
 Actually Paid to  
 PEO  
 ($)
(2)
  
 (c)  
  
 Average  
 Summary  
 Compensation  
 Table Total for  
 Non-PEO NEOs  

 ($)
(3)
  
 (d)  
  
 Average  
 Compensation  
 Actually Paid to  
 Non-PEO NEOs  
 ($)
(4)
  
 (e)  
  
Value of Initial Fixed $100
investment Based On:
  
 Net  
 Income  
 ($mm)
(7)
  
 (h)  
  
 Adjusted  
 EPS  
 ($)
(8)
  
 (i)  
 
 
 Total  
 Shareholder  
 Return  
 ($)
(5)
  
 (f)  
  
 Peer Total  
 Shareholder  
 Return  
 ($)
(6)
  
 (g)  
 
        
2023  16,327,384   (37,708  3,866,828   1,654,500   128   136   2,484   26.09 
        
2022  17,198,844   30,353,498   4,154,126   6,537,728        143        137      2,802      25.24 
        
2021  16,528,036   25,833,960   4,111,051   5,872,201   128   147   2,934   20.64 
        
2020  16,489,639   28,417,233   4,102,566   6,516,350   113   118   3,367   18.75 
(1)The dollar amounts reported in column (b) are the amounts of total compensation reported for Mr. Broussard (our Director and Chief Executive Officer) for each corresponding year in the “Total” column of the Summary Compensation Table. Refer to “Summary Compensation Table” in the proxy statement.
(2)The dollar amounts reported in column (c) represent the amount of CAP to Mr. Broussard, as computed in accordance with PvP Rules. The dollar amounts do not reflect the actual amount of compensation earned by or paid to Mr. Broussard during the applicable year. In accordance with the requirements of PvP Rules, the following adjustments were made to Mr. Broussard’s total compensation for the most recent fiscal year to determine the Mr. Broussard’s CAP:
     
Year
 
 Summary  
 Compensation  
 Table Total 
 ($)  
 
Equity
Deductions
from SCT
Total
(a)
($)
  
Equity
Additions
to SCT
Total
(b)
($)
  
 Pension  
 Additions  
 to SCT  
 Total  
 ($)  
 
 Compensation  
 Actually Paid  
 ($)  
     
2023
(2)
 16,327,384  (14,391,707  (1,973,385 N/A (37,708)
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Humana | 20222024 Proxy Statement 
Executive Compensation


(a)
The amounts in this column represent the grant date fair value of equity-based awards granted during each year. Pursuant to the requirements of Item 402(c)(2)(v) and (vi) of Regulation
S-K,
the Summary Compensation Table is required to include only those equity awards granted
during
the particular year. These equity awards are generally made in the first quarter of the year.
(b)
The equity award adjustments for the most recent fiscal year include the addition (or subtraction, as applicable) of the following: (i) the
year-end
fair value of any equity awards granted in the most recent fiscal year that are outstanding and unvested as of the end of the year; (ii) the amount of change as of the end of the most recent fiscal year (from the end of the prior fiscal year) in fair value of any awards granted in prior years that are outstanding and unvested as of the end of the most recent fiscal year; (iii) for awards that are granted and vest in the most recent fiscal year, the fair value as of the vesting date; (iv) for awards granted in prior years that vest in the most recent fiscal year, the amount equal to the change as of the vesting date (from the end of the prior fiscal year) in fair value; (v) for awards granted in prior years that are determined to fail to meet the applicable vesting conditions during the most recent fiscal year, a deduction for the amount equal to the fair value at the end of the prior fiscal year; and (vi) the dollar value of any dividends or other earnings paid on stock or option awards in the most recent fiscal year prior to the vesting date that are not otherwise reflected in the fair value of such award or included in any other component of total compensation for the most recent fiscal year. The valuation assumptions used to calculate fair values did not materially differ from those disclosed at the time of grant. The amounts deducted or added in calculating the equity award adjustments are as follows:
       
Year
 
Year End Fair 
Value of
Current Year
Equity
Awards
($)
  
Year over
Year Change in
Fair Value of
Outstanding
and Unvested 
Equity Awards 
($)
  
Fair Value as of
Vesting Date of 
Equity Awards
Granted and
Vested in the
Year
($)
  
Year over Year
Change in Fair
Value of Equity
Awards Granted
in Prior Year that
Vested in the
Year
($)
  
Fair Value at
the End of
the Prior Year 
of Equity
Awards that
Failed to
Meet Vesting
Conditions in
the Year
($)
  
Average Value of 
Dividends or
other Earnings
Paid on Stock or
Option Awards
not Otherwise
Reflected in Fair
Value or Total
Compensation
($)
  
Total Equity 
Award
Adjustments 
($)
 
       
2023  5,845,684   (8,536,144  (623,402  1,059,744        0   280,733   (1,973,385
(3)The dollar amounts reported in column (d) represent the average of the amounts reported for the Company’s named executive officers (NEOs) as a group (excluding Mr. Broussard, who has served as our CEO since 2013) in the “Total” column of the Summary Compensation Table in each applicable year. The names of each of the NEOs (excluding Mr. Broussard) included for purposes of calculating the average amounts in each applicable year are (a) for 2023, Susan M. Diamond, Sanjay K. Shetty, Joseph C. Ventura, and George Renaudin II; (b) for 2022, Susan M. Diamond, T. Alan Wheatley, Timothy S. Huval, and Joseph C. Ventura; (c) for 2021, Susan M. Diamond, Brian A. Kane, T. Alan Wheatley, Timothy S. Huval, and William K. Fleming; and (d) for 2020, Brian A. Kane, T. Alan Wheatley, Timothy S. Huval, and William K. Fleming.
(4)The dollar amounts reported in column (e) represent the average amount of CAP to the NEOs as a group (excluding Mr. Broussard), as computed in accordance with the PvP Rules. The dollar amounts do not reflect the actual average amount of compensation earned by or paid to the NEOs as a group (excluding Mr. Broussard) during the applicable year. In accordance with the requirements of the PvP Rules, the following adjustments were made to average total compensation for the NEOs as a group (excluding Mr. Broussard) for the most recent fiscal year to determine the CAP, using the same methodology described above in Note 2:
     
Year
 
 Summary  
 Compensation  
 Table Total  
 ($)  
 
Equity
Deductions
from SCT
Total ($)
  
Equity
Additions
to SCT
Total
($)
  
 Pension  
 Additions  
 to SCT  
 Total  
 ($)  
 
 Compensation  
 Actually Paid  
 ($)  
     
2023
(3)
 3,866,828  (2,518,860  306,532  N/A 1,654,500
Executive Compensation
 2024 Proxy Statement | Humana
79

The amounts deducted or added in calculating the total average equity award adjustments are as follows:
       
Year
 
Year End Fair 
Value of
Current Year
Equity
Awards
($)
  
Year over
Year Change in
Fair Value
of
Outstanding
and Unvested 
Equity Awards 
($)
  
Fair Value as of 
Vesting Date of
Equity Awards
Granted and
Vested in the
Year
($)
  
Year over Year
Change in Fair 
Value of Equity 
Awards Granted
in Prior Year
that Vested in
the Year
($)
  
Fair Value at
the End of the 
Prior Year of
Equity Awards
that Failed to
Meet Vesting
Conditions in
the Year
($)
  
Average Value of 
Dividends or
other Earnings
Paid on Stock or
Option Awards
not Otherwise
Reflected in Fair
Value or Total
Compensation
($)
  
Total Equity
Award
Adjustments
($)
 
       
2023  1,047,241   (863,823  (85,465  187,055        0   21,525   306,532 
(5)Cumulative TSR is calculated by dividing the sum of the cumulative amount of dividends for the measurement period, assuming dividend reinvestment, and the difference between the Company’s share price at the end and the beginning of the measurement period by the Company’s share price at the beginning of the measurement period.
(6)Represents the weighted peer group TSR, weighted according to the respective companies’ stock market capitalization at the beginning of each period for which a return is indicated. The peer group used for this purpose is the following published industry index: Dow Jones U.S. Select Health Care Providers Total Return Index.
(7)The dollar amounts reported represent the amount of Net Income reflected in the Company’s audited financial statements for the applicable year. While the Company does not use net income as a performance measure in its executive compensation program, the measure of net income is correlated with the measure Adjusted ROIC, which the company does use when setting goals in the Company’s long-term incentive compensation program.
(8)
Adjusted EPS is defined at page A-III-1 of this proxy statement, under “Annex III - Reconciliation of Non-GAAP Financial Measure.” While the Company uses numerous financial and
non-financial
performance measures for the purpose of evaluating performance for the Company’s compensation programs, the Company has determined that Adjusted EPS is the financial performance measure that, in the Company’s assessment, represents the most important performance measure (that is not otherwise required to be disclosed in the table) used by the company to link CAP to the company’s NEOs, for the most recently completed fiscal year, to company performance.
Pay Versus Performance Table
As described in greater detail in the Compensation Discussion and Analysis set forth in this proxy statement, the Company’s executive compensation program reflects a variable
pay-for-performance
philosophy. The metrics that the Company uses for both our long-term and short-term incentive awards are selected based on an objective of incentivizing our NEOs to increase the value of our enterprise for our shareholders.
The three performance measures listed below represent an unranked list of the “most important” performance measures that Humana used to align CAP to the NEOs for 2023 and company performance. While these financial measures are the most important measures the company used to align CAP to the NEOs for 2023 and company performance, additional financial and other measures were also used to align pay and performance, as further described in the Compensation Discussion and Analysis section of this proxy statement.
The most important performance measures are:
Adjusted Earnings Per Share
Adjusted Return on Invested Capital
Relative Total Shareholder Return
These financial quantitative measures generally reflect those used internally to measure our performance and externally to report to investors, and we believe that, taken together, they provide a holistic measure of Company growth, shareholder value and overall financial performance. As noted above, we have deemed Adjusted EPS as the “most important” financial measure used to link our NEO’s compensation with performance and, as previously disclosed, it is being used as our Company Selected Measure. For more detail on these measures and why we believe that they are important in structuring our incentive compensation programs and linking pay with performance, please see the discussion under “Plan Design and Performance Measures” in this proxy statement.
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Humana | 2024 Proxy Statement 
Executive Compensation

Analysis of the Information Presented in the Pay Versus Performance Table
While Humana uses several performance measures to align executive compensation with Company performance, all of those Company measures are not presented in the Pay versus Performance Table set forth herein. Moreover, Humana generally seeks to incentivize long-term performance, and therefore does not specifically align the Company’s performance measures with compensation that is actually paid (as computed in accordance with PvP Rules) for a particular year. In accordance with the PvP Rules, Humana is providing the following descriptions of the relationships between information presented in the Pay versus Performance Table.
Compensation Actually Paid and Adjusted EPS
The following graphs depict the relationship between EPS and CAP to Humana’s CEO and the NEOs, respectively.
Compensation Actually Paid and Net Income
The following graphs depict the relationship between Net Income and CAP to Humana’s CEO and the NEOs, respectively.
Compensation Actually Paid and Relative TSR
The following graphs depict the relationship between TSR and CAP to Humana’s CEO and the NEOs, respectively.
Executive Compensation
 2024 Proxy Statement | Humana
81


Certain Transactions with Management and Others

 

The Board of Directors has determined that there are no material transactions involving a current director or director nominee of the Company. For a discussion of the transactions reviewed, please see the discussion under “Independent Directors” herein.

The Board of Directors has reviewed the following transactionstransaction involving an executive officer, former director ora greater than 5% stockholder:

 

During 2021, the Company had an agreement with BlackRock, Inc., or BlackRock, which holds greater than five percent of the Company’s outstanding stock as of December 31, 2021. Under this agreement, BlackRock provided fixed income investment management services to the Company, for which the Company paid approximately $3.83 million in fees for the year ended December 31, 2021. The fees were determined solely on the amount of assets under management, and, to our knowledge, were comparable to those of non-affiliated customers. During 2021 the Company received approximately $48,600 in fees associated with employee assistance program services, which is an amount that is comparable to other non-affiliated customers for the provision of similar services.

During 2021, the Company maintained a mutual fund with FMR LLC, or Fidelity Investments, in which the Company invested in the Fidelity Investments Money Market Treasury Portfolio mutual fund. In connection with this mutual fund, the Company paid approximately $108,472 in management fees for the year ended December 31, 2021. The fees were determined solely based on the institutional share class expense ratio of 0.14%, as disclosed in fund’s prospectus, and, to our knowledge, said share class is available to all non-affiliated investors that meet the minimum required investment balance.

  

During 2021,2023, the Company had a business relationshipan agreement with Stock Yards Bank & Trust,BlackRock, Inc., or BlackRock, which holds greater than five percent of the Company’s outstanding stock as of December 31, 2023. Under this agreement, BlackRock provided fixed income investment management services to the Company, for which the brother of our executive officer Cynthia H. Zipperle serves as Chairman and Chief Executive Officer. The Company receivedpaid approximately $1.20$5.43 million in connection with healthcare administration fees associated withfor the Company’s self-funded ASO plan offeringsyear ended December 31, 2023. The fees were determined solely on the amount of assets under management, and, Go365® wellness and rewards program and approximately $1.16 million in healthcare premiums, of which all amounts areto our knowledge, were comparable to other non-affiliated customers for the provisionthose of similar services.non-affiliated customers.

The Board of Directors has adopted a policy for review, approval and monitoring of transactions involving the Company and directors and executive officers or their immediate family members, or stockholders owning five percent or greater of the Company’s outstanding stock. The policy covers any related person transaction that meets the minimum threshold for disclosure under the SEC’s regulations. The Related Party Transaction Approval Policy may be viewed on our website. From the www.humana.com website, click on “Investor Relations,“More Humana,” then click on “For Investors,” then click on “Corporate Governance,” and then click on the link entitled “Policy Regarding Related Person Transactions.” Pursuant to that policy, our Board of Directors has approved the continuation for 20222024 of the above describedabove-described relationships.

 

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Audit Committee Report

 

 

Our Audit Committee currently is comprised of fourfive directors. All members are independent and are financially literate as defined in the NYSE listing standards. The Board of Directors has determined that Messrs. D’Amelio and Garratt and Dr. Bono each meet the definition of “audit committee financial expert.” The Board of Directors has adopted a written charter for the Committee.

As set forth in its Charter, our Audit Committee is directly responsible for the appointment, compensation, retention and oversight of the work of the independent registered public accounting firm engaged to prepare the audit report or perform other audit, review or attestation services. The Audit Committee has retained PricewaterhouseCoopers LLP, or PwC, as the Company’s independent registered public accounting firm for fiscal year 2022.2024. PwC has been retained as the Company’s independent registered public accounting firm continuously since 1968.

The Audit Committee reviews Humana’s financial reporting processes on behalf of the Board of Directors. In fulfilling its responsibilities, the Audit Committee has reviewed and discussed the audited financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2021,2023, with Humana’s management and its independent registered public accounting firm, PwC. Management is responsible for the financial statements and the reporting process, including its assessment of our internal control over financial reporting. PwC is responsible for expressing an opinion on the conformity of those audited financial statements with accounting principles generally accepted in the United States of America. Management has represented to PwC and the Audit Committee that our consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States of America. The Audit Committee discussed with PwC the matters required to be discussed by Auditing Standard No. 1301, Communications with Audit Committees. In addition, the Audit Committee has discussed with PwC its independence from Humana and its management including the matters in the written disclosures required by applicable requirements of the Public Company Accounting Oversight Board regarding the independent registered public accounting firm’s communications with the Audit Committee concerning independence.

During 2021,2023, the Audit Committee met independently with our Chief Audit Officer, our Chief Risk Officer, our Chief Compliance Officer, key members of management, and PwC regarding our business, current and planned audit activities, and risks that could impact the Company and management actions to mitigate those risks. The Audit Committee, in consultation with management, Internal Audit, and PwC, reviewed our quarterly financial statements and earnings releases. The Audit Committee reviewed our annual financial statements. Audit Committee members individually reviewed our monthly operating and financial information as well as internal audits of controls over operations, financial processes, and compliance with laws and regulations.

The Audit Committee reviewed and evaluated the relevant requirements of the Sarbanes-Oxley Act of 2002, the rules of the SEC and the listing standards of the NYSE regarding audit committee procedures and responsibilities, including a review of our internal controls and procedures.

The Audit Committee reviewed and approved the services provided by PwC to us consisting of the following:

 

 
   

 

For The Years Ended
December 31

 
  
   2021   2020 
  

Audit Fees

  $10,462,000   $6,003,000 
  

Audit Related Fees

  $1,255,000   $1,650,000 
  

Tax Fees

  $146,475   $157,362 
  

All Other Fees

  $1,257,356   $2,620,788 
  

TOTAL

  $13,120,831   $10,431,150 

Audit Fees include activities relating to the audit of our consolidated financial statements, the audit of internal control over financial reporting, statutory and other separate Company audits, work performed in connection with registration statements, and consultations related to miscellaneous SEC and financial reporting matters. The increase in audit fees primarily relates to our acquisition of Kindred at Home in 2021.

Audit Related Fees include other assurance and related services including the audits of our employee benefit plans, Service Organization Controls (SOC) reports and other mandated regulatory and compliance attestation services. No amounts were paid for financial systems design and implementation.

 
 

 

  

 

For The Years Ended
December 31

 
  
 

 

  2023   2022 
  

Audit Fees

  $7,703,000   $8,058,000 
  

Audit Related Fees

  $1,461,500   $1,378,500 
  

Tax Fees

  $170,566   $97,931 
  

All Other Fees

  $600,900   $364,747 
  

TOTAL

  $9,935,966   $9,899,178 

 

Audit Fees include activities relating to the audit of our consolidated financial statements, the audit of internal control over financial reporting, statutory and other separate Company audits, work performed in connection with registration statements, and consultations related to miscellaneous SEC and financial reporting matters.

Audit Related Fees include other assurance and related services including the audits of our employee benefit plans, Service Organization Controls (SOC) reports and other mandated regulatory and compliance attestation services. No amounts were paid for financial systems design and implementation.

Tax Fees include activities relating to tax compliance, consultation and support services.

All Other Fees include activities related to advisory services and the annual renewal of software licenses.

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Humana  |  2022 Proxy Statement  Audit Committee Report

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Tax Fees include activities relating to tax compliance, consultation and support services.

All Other Fees include activities related to advisory services and the annual renewal of software licenses for accounting research.

The Audit Committee discussed with our internal auditors and with PwC the overall scope and plans for their respective audits. At each meeting, the Audit Committee is provided the opportunity to meet with the internal auditors and with PwC with and without management present, and, in fact, met with the internal auditors and with PwC with and without management present in connection with each regularly scheduled Board of Directors meeting in 2021.2023.

The Audit Committee has established policies and procedures for pre-approving all audit, review and attest services that are required under the securities laws and all other permissible tax and non-audit services necessary to assure PwC’s continued independence. The Audit Committee annually pre-approves the following permissible non-audit services:

 

related assurance and attestation services;

related assurance and attestation services;

 

risk and control services;

risk and control services;

 

transaction services; and

transaction services; and

 

tax services.

tax services.

The fees shown in the table above were all pre-approved in accordance with these policies and procedures. The Audit Committee separately will consider any proposed retention of the independent registered public accounting firm for permissible non-audit services other than those listed above. The Audit Committee is responsible for the audit fee negotiations associated with the Company’s retention of PwC.

In reliance on the reviews and discussions referred to above, the Audit Committee recommended to the Board of Directors, and the Board has approved, that the audited financial statements be included in the Humana Annual Report on Form 10-K for the year ended December 31, 2021.2023.

All members of the Audit Committee of the Company whose names follow submit the foregoing report:

AUDIT COMMITTEE

Frank A. D’Amelio, ChairmanChair

Raquel C. Bono, M.D.

John W. Garratt

Marcy S. Klevorn

William J. McDonald

 

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Humana | 2024 Proxy Statement Audit Committee Report  2022 Proxy Statement  |  Humana

 

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Proposal Two

Ratification of Appointment of Independent Registered Public Accounting Firm

 

Background

The Board of Directors, in accordance with the recommendation of its Audit Committee, believes that the continued retention of PwC as the Company’s independent registered public accounting firm is in the best interests of the Company and its stockholders, and therefore has appointed PwC to audit the consolidated financial statements of the Company for the year ending December 31, 2022.2024. In making this appointment, the Board considered the performance and independence of PwC, including whether any non-audit services performed by PwC are compatible with maintaining independence. The Audit Committee and Board of Directors believe that PwC has invaluable long-term knowledge of Humana. While preserving that knowledge, partners and employees of PwC engaged in audits of Humana are periodically changed, giving Humana access to new expertise, experience and perspectives.

We are asking our stockholders to ratify the appointment of PwC as our independent registered public accounting firm. Although ratification is not required by our Charter, Bylaws, Delaware law or otherwise, the Board is submitting the appointment of PwC to our stockholders for ratification because we value our stockholders’ views on our independent registered public accounting firm. If our stockholders fail to ratify the appointment, it will be considered as a non-binding recommendation to the Board and the Audit Committee to consider the appointment of a different firm for fiscal year 2023.2025. Even if the appointment is ratified, the Board and the Audit Committee may select a different independent registered public accounting firm at any time during the year if it determines that such a change would be in the best interests of the Company and our stockholders. We expect that representatives of PwC will be present at the Annual Meeting and will be afforded the opportunity to make a statement if they desire to do so and to respond to appropriate questions.

Vote Required and Recommendation of the Board of Directors

The affirmative vote of the holders of a majority of the votes present and entitled to vote with respect tocast affirmatively or negatively on this the proposal is required for the ratification of the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm. Abstentions and Shares not present at the meeting have no effect on the ratification of the appointment of PricewaterhouseCoopers LLP, while Shares voting “abstain” will be counted as “against” votes.LLP. Pursuant to NYSE regulations, brokers and other NYSE member organizations have discretionary voting power over the ratification of the appointment of the Company’s independent registered public accounting firm. If you timely submit a signed proxy but fail to specify instructions to vote with respect to this proposal, the accompanying proxy will be voted FOR this proposal.

LOGO

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE RATIFICATION OF THE APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM.

 

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Proposal Two 2024 Proxy Statement | Humana

   

Humana  |  2022 Proxy Statement  Proposal Two

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Proposal Three

Non-Binding Advisory Vote with Respect to the Compensation of the Company’s Named Executive Officers

 

Background

The Dodd-Frank Act requires that we include in our proxy statement a non-binding advisory stockholder vote with respect to the frequency of future advisory votes regarding the compensation of our Named Executive Officers as described in the Compensation Discussion and Analysis section, the compensation tables and the accompanying narrative disclosure, set forth in this proxy statement (commonly referred to as “Say-on-Pay”).

At our 20172023 Annual Meeting, held on April 20, 2017,2023, our stockholders recommended an annual Say-on-Pay vote, and our Board of Directors subsequently adopted that recommendation. In 2022,2024, we are therefore asking our stockholders to vote on the following resolution:

RESOLVED, that the stockholders of Humana Inc. approve, on an advisory basis, the compensation of the Company’s Named Executive Officers, as described in the Compensation Discussion and Analysis section, the compensation tables, and the accompanying narrative disclosure, set forth in the Company’s proxy statement.

The compensation of our Named Executive Officers is disclosed in the Compensation Discussion and Analysis, the compensation tables, and the related disclosures contained in this proxy statement. As discussed in those disclosures, our philosophy is that compensation should be market-based, competency-paced and contribution-driven. Our compensation programs are designed to challenge participants as well as reward them for superior performance for our Company and our stockholders, with an emphasis on pay for performance principles to align the interests of our Named Executive Officers with those of our stockholders. Our compensation practices and policies enable us to attract and retain talented and experienced executives to lead the Company successfully in a competitive environment.

Your vote on this Proposal Three is an advisory one, and therefore is not binding on the Company, the Organization & Compensation Committee, or the Board. The vote will not be construed to create or imply any change to the fiduciary duties of the Company or the Board, or to create or imply any additional fiduciary duties for the Board. Nevertheless, our Board and our Organization & Compensation Committee value the opinions of our stockholders and intend to consider any stockholder concerns evidenced by this vote. We will continue to evaluate and disclose whether any actions are necessary to address those concerns.

Vote Required and Recommendation of the Board of Directors

TheThis proposal requires the affirmative vote of the holders of a majority of the votes present and entitled to vote with respect to thecast affirmatively or negatively on this proposal is required for the approval of the non-binding advisory vote with respect to the compensation of the Company’s Named Executive Officers. Abstentions, Shares not present at the meeting and broker non-votes have no effect on the approval of this non-binding advisory vote, while abstentions will count as votes “against.”vote. Pursuant to NYSE regulations, brokers do not have discretionary voting power over this proposal, and therefore, if you hold Shares through a broker or other NYSE member organization and do not provide voting instructions to your broker or other NYSE member organization, your Shares will not be voted with respect to this proposal. If you timely submit a signed proxy but fail to specify instructions to vote with respect to this proposal, the accompanying proxy will be voted FOR this proposal.

LOGO

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE PROPOSAL TO APPROVE THE COMPENSATION OF THE COMPANY’S NAMED EXECUTIVE OFFICERS AS DESCRIBED IN THE COMPENSATION DISCUSSION AND ANALYSIS, THE COMPENSATION TABLES, AND THE RELATED DISCLOSURES CONTAINED IN THIS PROXY STATEMENT.

 

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Humana | 2024 Proxy Statement Proposal Three


Proposal Four

Approval of Amendment to the Company’s Restated Certificate of Incorporation to Limit the Liability of Certain Officers of the Company as Permitted by Delaware Law

Background

This proposal seeks to amend our Restated Certificate of Incorporation(our “Charter”) in light of a recent amendment to Delaware law permitting corporations to limit the personal liability of certain senior executive officers.

Section 102(b)(7) of the General Corporation Law of the State of Delaware (“DGCL”) has long permitted a Delaware corporation such as the Company to include in its certificate of incorporation a provision eliminating the personal liability of directors for breaches of fiduciary duties, subject to various exceptions; accordingly, Article Tenth of our Charter has long included such a provision protecting directors.

Because such provisions did not extend to officers, stockholder plaintiffs have employed a tactic of bringing certain claims that would be dismissed if brought against directors, against individual officers to avoid dismissal of such claims. To address the inconsistent treatment between directors and officers and rising litigation and insurance costs, Section 102(b)(7) was amended, effective August 1, 2022, to permit a Delaware corporation to include in its certificates of incorporation a provision eliminating personal liability of certain officers of the corporation for breaches of fiduciary duties, subject to various exceptions (the “Section 102(b)(7) Amendment”). The officers covered by the Section 102(b)(7) Amendment include the president, chief executive officer, chief operating officer, chief financial officer, chief legal officer, controller, treasurer and chief accounting officer and any officer identified in the corporation’s filings with the SEC as one of the corporation’s most highly compensated executive officers.

After deliberation, our Board unanimously determined that it is in the best interest of the Company and its stockholders to amend our Charter to include a provision of the type authorized by the Section 102(b)(7) Amendment to allow us to (i) continue to attract and retain talented executive officers in light of the fact that many of our peers and other companies with which we complete for talent have adopted, or are likely to adopt, such a provision, and (ii) potentially decrease litigation costs and the cost of directors’ and officers’ insurance in the future.

Proposed Changes

In light of the foregoing, our Board unanimously adopted and declared advisable the amendments to our Charter set forth in Annex I, which would add a new provision to Article Tenth eliminating the personal liability of the officers of the Company for breaches of fiduciary duties as permitted by the Section 102(b)(7) Amendment. As is currently the case with directors under Article Tenth, the new provision would not limit the personal liability of any officer:

for breach of the duty of loyalty;

for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law; or

for any transaction in which the officer derived an improper personal benefit.

In addition, the Section 102(b)(7) Amendment would not limit the personal liability for any officer in an action brought by or in the right of the Company, such as a derivative action.

The foregoing summary of the proposed amendments to our Charter is qualified in its entirety by reference to the amendments set forth in Annex I, which shows the proposed addition to Article Tenth of our Charter by bold underlined text.

Proposal ThreeFour  2022 2024 Proxy Statement | Humana

 

     8387


Impact of the Proposal; Vote Required; Recommendation of the Board of Directors

If Proposal Four is approved by our stockholders, the amendments to our Charter subject to this Proposal Four would become effective upon the filing of a Certificate of Amendment with the Delaware Secretary of State, which the Company intends to do promptly following the Annual Meeting. If Proposal Four is not approved by our stockholders, Article Tenth of our Charter will remain unchanged.

This proposal requires the affirmative vote of the holders of a majority of the outstanding shares entitled to vote thereon. Abstentions, Shares not present at the meeting and broker non-votes will have the same effect as a vote against this proposal. Pursuant to NYSE regulations, brokers do not have discretionary voting power over this proposal, and therefore, if you hold Shares through a broker or other NYSE member organization and do not provide voting instructions to your broker or other NYSE member organization, your Shares will not be voted with respect to this proposal. If you timely submit a signed proxy but fail to specify instructions to vote with respect to this proposal, the accompanying proxy will be voted FOR this proposal.

LOGO

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE AMENDMENT TO OUR CHARTER TO LIMIT THE LIABILITY OF CERTAIN OFFICERS AS PERMITTED BY DELAWARE LAW.

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Humana | 2024 Proxy Statement Proposal Four


Proposal Five

Approval of Amendment to the Company’s Restated Certificate of Incorporation to Eliminate Supermajority Voting Requirement in Connection with Certain Transactions

Background

This proposal seeks to eliminate Article Eleventh of our Charter.

Under Article Eleventh, we are required to obtain a vote of stockholders holding three-fourths of our outstanding shares to (i) adopt an agreement providing for the merger or consolidation of Humana with a “related company”, (ii) authorize the sale or lease of all or substantially all of our assets to a related company, or (iii) authorize the sale or lease to us of any assets of a related company in exchange for our equity securities. Article Eleventh defines a “related company” as any person or entity that by itself or together with its affiliates and “associates” beneficially owns 5% or more of any class of our equity securities and defines an “associate” of a related company to include any beneficial owner of 5% or more of any class of the related company’s equity securities.

The consequence of Article Eleventh is that we could be required to obtain a supermajority vote of its stockholders to complete a merger or other major transaction with any other company that has even one greater than 5% stockholder in common with the us. As indicated under “Stock Ownership Information” beginning on page 44, BlackRock, Inc. and The Vanguard Group each beneficially owns more than 5% of the Company’s outstanding shares. Each of those investment firms also beneficially owns 5% or more the shares of many other companies both in our industry and across the market. Accordingly, due to the provisions of Article Eleventh, a merger or other major transaction with any such other company that is supported by holders of a majority of our outstanding shares could only be completed if approved by holders of at least three-fourths of our outstanding shares. The Board believes that this is an unduly restrictive provision, particularly given the possibility of not securing a quorum to be able to reach this level of support.

As part of our continuous evaluation of our corporate governance practices, our Board regularly reviews our governing documents and considers potential enhancements. In evaluating whether to recommend the elimination of Article Eleventh, our Board considered multiple factors, including the advantages and disadvantages of supermajority voting provisions in general and in light of our overall corporate governance structure, and the fact that many investors and other stakeholders view supermajority voting provisions as inconsistent with principles of good corporate governance on the basis that the requirement of a supermajority vote can limit the ability of stockholders to effect change by essentially providing a veto to a large minority stockholder or group of stockholders. During this process, our Board considered any potential risks associated with eliminating our supermajority voting requirements, specifically in the context of potential future transactions. For example, in the context of a major transaction with a company that has significant overlapping stockholders with us, some of those overlapping stockholders could choose to vote their Humana shares in favor of the transaction because they believe it would benefit them as stockholders of the other company (even though the transaction may not benefit them in their capacity as stockholders of Humana), and the supermajority voting requirements of Article Eleventh could be viewed as protective of Humana by requiring broad stockholder support for such a major transaction. However, our Board believes that this risk is more than outweighed by the risk that a transaction considered desirable by a majority of our stockholders is not approved because of the existing supermajority threshold. The Board continues to uphold its fiduciary responsibility in thoroughly evaluating all potential avenues for stockholder value creation, including potential mergers or major acquisitions.

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In addition, our Board took into account that none of the companies in our Peer Group (identified under “Peer Group” beginning on page 55) maintains a similar supermajority provision in its charter or bylaws. Given these circumstances, our Board believes that maintaining such a provision in our Charter could potentially impede Humana’s ability to execute transactions with peer companies in the future. For example, a potential transaction counterparty with even one greater than 5% stockholder in common with Humana may seek to bypass the burdensome supermajority voting requirement and instead transact with a different company that does not maintain the provision, thereby depriving Humana and its stockholders of a transaction opportunity that might otherwise have been available to them.

The Board also considered that a stockholder submitted to the Company a proposal seeking the elimination of supermajority voting provisions and that similar proposals had been supported by stockholders at many other companies. Considering the foregoing, our Board has determined that it is in the best interests of the Company and its stockholders to recommend that our stockholders adopt an amendment to eliminate Article Eleventh from our Charter.

Aside from Article Eleventh, there are no supermajority voting requirements in our Charter or Bylaws, except that Article Ninth of our Charter requires the unanimous vote of our stockholders in order to amend our Bylaws to provide for cumulative voting for the election of members of our Board or the introduction of a classified board structure. Our Board believes that it is in the best interest of stockholders, and consistent with corporate governance best practices, for each member or nominee to stand for re-election or election to our Board each year. In addition, cumulative voting is uncommon and not permitted under Delaware law to be implemented by means of a bylaw amendment. Therefore, our Board is not recommending at this time any amendments to Article Ninth of our Charter.

Proposed Changes

The Board unanimously adopted and declared advisable the amendments to our Charter set forth in Annex II, which would remove Article Eleventh from our Charter in its entirety.

The foregoing summary of the proposed amendments to the Charter described above is qualified in its entirety by reference to the amendments in full as set forth in Annex II, which shows the proposed deletions by strikethrough text.

Impact of the Proposal; Vote Required; Recommendation of the Board of Directors

If Proposal Five is approved by the Company’s stockholders, the amendments to our Charter subject to this Proposal Five would become effective upon the filing of a Certificate of Amendment with the Delaware Secretary of State, which the Company intends to do promptly following the Annual Meeting.

If Proposal Five is not approved by the Company’s stockholders, Article Eleventh of our Charter will remain unchanged and in effect.

This proposal requires the affirmative vote of the holders of at least three-fourths (75%) of the outstanding shares entitled to vote thereon. Abstentions, Shares not present at the meeting and broker non-votes will have the same effect as a vote against this proposal. Pursuant to NYSE regulations, brokers do not have discretionary voting power over this proposal, and therefore, if you hold Shares through a broker or other NYSE member organization and do not provide voting instructions to your broker or other NYSE member organization, your Shares will not be voted with respect to this proposal. If you timely submit a signed proxy but fail to specify instructions to vote with respect to this proposal, the accompanying proxy will be voted FOR this proposal.

LOGO

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” AMENDMENT TO OUR CHARTER TO ELIMINATE SUPERMAJORITY VOTING REQUIREMENT IN CONNECTION WITH CERTAIN TRANSACTIONS.

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Humana | 2024 Proxy Statement Proposal Five


Proposal Six

Stockholder Proposal on Simple Majority Vote

Background

Mr. John Chevedden, 2215 Nelson Avenue, No. 205, Redondo Beach, California 90278, holder of 10 shares of the Company’s common stock, has notified the Company of his intent to present a proposal at the Annual Meeting. In accordance with SEC rules, the Company has set forth below the proposal, along with the supporting statement of the stockholder proponent, for which the Company and the Board accept no responsibility. The stockholder proposal is required to be voted upon at the Annual Meeting only if properly presented at the Annual Meeting. As explained below, the Board unanimously recommends that you vote “AGAINST” the stockholder proposal.

The proponent’s proposal is as follows:

Simple Majority Vote — Proposal 6

LOGO

Shareholders request that our board take each step necessary so that each voting requirement in our charter and bylaws (that is explicit or implicit due to default to state law) that calls for a greater than simple majority vote be replaced by a requirement for a majority of the votes cast for and against applicable proposals, or a simple majority in compliance with applicable laws. If necessary this means the closest standard to a majority of the votes cast for and against such proposals consistent with applicable laws. This includes making the necessary changes in plain English.

Shareholders are willing to pay a premium for shares of companies that have excellent corporate governance. Supermajority voting requirements have been found to be one of 6 entrenching mechanisms that are negatively related to company performance according to “What Matters in Corporate Governance” by Lucien Bebchuk, Alma Cohen and Allen Ferrell of the Harvard Law School. Supermajority requirements are used to block initiatives supported by most shareowners but opposed by a status quo management.

This proposal topic won from 74% to 88% support at Weyerhaeuser, Alcoa, Waste Management, Goldman Sachs, FirstEnergy, McGraw-Hill and Macy’s. These votes would have been higher than 74% to 88% if more shareholders had access to independent proxy voting advice. This proposal topic also received overwhelming 98%-support each at the 2023 annual meetings of American Airlines (AAL) and The Carlyle Group (CG).

Please vote yes:

Simple Majority Vote — Proposal 6

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HUMANA OPPOSING STATEMENT

This Proposal Six requests a simple majority standard in connection with each voting requirement in the Charter and Bylaws. The Board has considered the stockholder proposal relative to the Company’s specific circumstances and concluded that its adoption is unnecessary and would not be in the best interests of the Company or its stockholders. As detailed in Proposal Five, eliminating Article Eleventh of our Charter instead would benefit the Company and its stockholders.

Therefore, the Board recommends that the Company’s stockholders oppose this proposal and instead vote “FOR” Proposal Five.

This proposal does not specify that most of our Charter and Bylaw voting requirements are for a majority vote of our stockholders. In fact, if Proposal Five is adopted, the only other provision requiring greater than a majority vote of the Company’s stockholders would be in Article Ninth of our Charter which the Board believes should have a higher threshold due to the nature of the provision. This provision prohibits our Board and stockholders from amending the Company’s Bylaws to provide for cumulative voting for the election of members of our Board or the introduction of a classified board structure without the unanimous approval of the Company’s stockholders. Because cumulative voting is uncommon and not permitted under Delaware law to be implemented by means of a bylaw amendment, and the Board does not support a classified board structure (which is opposed by most governance experts and many of our investors), the Board does not believe an amendment to this provision of Article Ninth is appropriate or necessary.

Moreover, our Board believes that matters voted on by our stockholders should generally be approved or disapproved by a majority of the votes cast for or against the applicable proposal, except where a different standard is required by applicable law or is consistent with standard market practice for a particular matter. Specifically, under our Charter and Bylaws, only three matters require approval by a majority of all outstanding shares (rather than a majority of the votes cast): (a) an amendment to our Charter; (b) the removal of directors; and (c) an amendment of our Bylaws. The first two are mandated by Delaware law, and the third is consistent with standard market practice for stockholder bylaws amendments.

Accordingly, the Board believes that this advisory and non-binding stockholder Proposal Six is inappropriate and unnecessary. For the foregoing reasons, the Board unanimously recommends that you vote “AGAINST” Proposal Six and instead vote “FOR” Proposal Five.

Vote Required and Recommendation of the Board of Directors

This proposal requires the affirmative vote of the holders of a majority of the votes cast affirmatively or negatively on this proposal. The proposal is precatory and accordingly, is not binding on the Board or the Company. Abstentions, Shares not present at the meeting and broker non-votes have no effect on the approval of this proposal. Pursuant to NYSE regulations, brokers do not have discretionary voting power over this proposal, and therefore, if you hold Shares through a broker or other NYSE member organization and do not provide voting instructions to your broker or other NYSE member organization, your Shares will not be voted with respect to this proposal. If you timely submit a signed proxy but fail to specify instructions to vote with respect to this proposal, the accompanying proxy will be voted AGAINST this proposal.

LOGO

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “AGAINST” PROPOSAL SIX.

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Humana | 2024 Proxy Statement Proposal Six


Frequently Asked Questions

Why am I receiving this proxy statement?

You are receiving a proxy statement because you owned Humana Inc. common stock, which we refer to as Shares, as of Thursday, February 29, 2024, which we refer to as the Record Date, and that entitles you to vote at the Annual Meeting. Our Board of Directors has made these materials available to you on the Internet or, upon your request, has delivered printed versions of these materials to you by mail, in connection with the Board’s solicitation of proxies on behalf of the Company for use at our 2024 Annual Meeting of Stockholders. Your proxy will authorize specified people (proxies) to vote on your behalf at the Annual Meeting. By use of a proxy, you can vote, whether or not you attend the meeting.

This proxy statement describes the matters on which the Company would like you to vote, provides information on those matters, and provides information about the Company that we must disclose when we solicit your proxy.

Why did I receive a one-page notice in the mail regarding the Internet availability of proxy materials instead of a full set of proxy materials?

Pursuant to rules adopted by the SEC, we have elected to provide access to our proxy materials over the Internet. We believe that Internet delivery of our proxy materials allows us to provide our stockholders with the information they need, while lowering the costs of delivery and reducing the environmental impact of our Annual Meeting. Accordingly, we are sending a Notice of Internet Availability of Proxy Materials, which we refer to as the Notice, to our stockholders and beneficial owners as of the Record Date. All stockholders will have the ability to access the proxy materials on a website referred to in the Notice or request to receive a printed set of the proxy materials. Instructions on how to access the proxy materials over the Internet or to request a printed copy may be found on the Notice. In addition, stockholders may request to receive proxy materials in printed form by mail or electronically by e-mail on an ongoing basis by calling Broadridge Financial Solutions, Inc., or Broadridge, at 1-800-579-1639.

How can I get electronic access to the proxy materials?

The Notice provides you with instructions regarding how to:

View our proxy materials for the Annual Meeting on the Internet; and

Instruct us to send our future proxy materials to you electronically by e-mail.

Choosing to receive your future proxy materials by e-mail will save us the cost of printing and mailing documents to you and will reduce the impact of our Annual Meetings on the environment. If you choose to receive future proxy materials by e-mail, you will receive an e-mail next year with instructions containing a link to those materials and a link to the proxy voting site. Your election to receive proxy materials by e-mail will remain in effect until you terminate it.

When and where is the Annual Meeting?

The Annual Meeting will be held on Thursday, April 18, 2024, at 1:00 p.m., Eastern Time, via live audio webcast and will be accessible at www.virtualshareholdermeeting.com/HUM2024.

Who is entitled to vote?

Anyone who owns Shares, as of the close of business on February 29, 2024, the Record Date, is entitled to vote at the Annual Meeting or at any later meeting should the scheduled Annual Meeting be adjourned or postponed for any reason. As of the Record Date, 120,548,748 Shares were outstanding and entitled to vote. Each Share is entitled to one vote on each of the matters to be considered at the Annual Meeting.

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What will I be voting on?

Election of the eleven (11) director nominees named in this proxy statement to serve on the Board of Directors of the Company;

Ratification of the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for 2024;

A non-binding, advisory vote to approve the compensation of the Company’s Named Executive Officers as disclosed in this proxy statement;

Approval of the amendment to the Company’s Restated Certificate of Incorporation to limit the liability of certain officers of the Company as permitted by Delaware law;

Approval of the amendment to the Company’s Restated Certificate of Incorporation to eliminate supermajority voting requirement in connection with certain transactions; and

the stockholder proposal set forth in this proxy statement, if properly presented at the meeting.

The Board of Directors is not aware of any other matters to be presented for action at the Annual Meeting. However, if other matters are properly presented for a vote, the proxies will be voted for these matters in accordance with the judgment of the persons acting under the proxies.

How does the Board recommend I vote on each proposal?

The Board recommends that you vote your Shares as follows:

FOR the election of each of the eleven (11) director nominees named in this proxy statement;

FOR the ratification of the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for 2024;

FOR the approval of the compensation of the Company’s Named Executive Officers as disclosed in this proxy statement;

FOR the approval of the amendment to the Company’s Restated Certificate of Incorporation to limit the liability of certain officers of the Company as permitted by Delaware law;

FOR the approval of the amendment to the Company’s Restated Certificate of Incorporation to eliminate supermajority voting requirement in connection with certain transactions; and

AGAINST the stockholder proposal set forth in this proxy statement, if properly presented at the meeting.

All Shares that are represented at the Annual Meeting by properly executed proxies received before or at the Annual Meeting and not revoked will be voted at the Annual Meeting in accordance with the instructions indicated in the proxies.

How do I participate in the Annual Meeting?

This year’s Annual Meeting will be held in a virtual format through a live audio webcast. You are entitled to participate in the Annual Meeting if you were a stockholder as of the close of business on the Record Date or hold a valid proxy for the meeting. Stockholders who attend virtually will be afforded the same rights and opportunities to participate as they would at an in-person meeting. Accordingly, as stockholders, you will be able to listen, submit your questions and vote your shares online regardless of location. The Company will provide Rules of Conduct which can be obtained at www.proxyvote.com after logging in with your unique 16-digit control number provided on your Notice of Internet Availability of Proxy Materials, your proxy card or your voting instruction form that accompanied your proxy materials (your “Control Number”). The Rules of Conduct will be strictly adhered to during the Annual Meeting.

To be admitted to the Annual Meeting at www.virtualshareholdermeeting.com/HUM2024, you must enter your Control Number. If you are a beneficial stockholder, you may contact the bank, broker or other institution where you hold your account if you have questions about obtaining your Control Number. Non-stockholders are welcome to attend the Annual Meeting through the guest log-in at www.virtualshareholdermeeting.com/HUM2024, however guests will not be allowed to participate during the Annual Meeting except as listeners.

A question-and-answer session will be available to stockholders during the Annual Meeting and will include questions submitted in advance of, and questions submitted live during, the Annual Meeting. You may submit a question in advance of the meeting at www.proxyvote.com after logging in with your Control Number. Questions may be submitted during the Annual Meeting through www.virtualshareholdermeeting.com/HUM2024. The Company’s Corporate Secretary will review all questions to ensure that those presented for response are in accordance with the Rules of Conduct.

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We encourage you to access the Annual Meeting before it begins. Online check-in will begin approximately thirty minutes before the Annual Meeting. Technicians will be available to assist you during that time if you have difficulty accessing the Annual Meeting.

How do I vote?

There are four ways that you can vote your Shares. Voting by any of these methods will supersede any prior vote you made regardless of how that vote was made. PLEASE CHOOSE ONLY ONE OF THE FOLLOWING:

1)

By Internet. The website for voting is www.proxyvote.com. In order to vote on the Internet, you need the Control Number on your proxy card. Each stockholder has a unique control number so we can ensure all voting instructions are genuine and prevent duplicate voting. The Internet voting system is available 24 hours a day, seven days a week, until 11:59 p.m., Eastern Time, on Wednesday, April 17, 2024, the day before the Annual Meeting. Once you are logged on the Internet voting system, you can record and confirm (or change) your voting instructions. If you use the Internet voting system, you do not need to return your proxy card.

2)

By Telephone. If you are a registered holder in the United States or Canada, you may call 1-800-690-6903. The telephone voting system is available 24 hours a day, seven days a week, until 11:59 p.m., Eastern Time, on Wednesday, April 17, 2024, the day before the Annual Meeting. In order to vote by telephone, you need the Control Number on your proxy card. Each stockholder has a unique Control Number so we can ensure all voting instructions are genuine and prevent duplicate voting. Once you are logged on the telephone voting system, a series of prompts will tell you how to record and confirm (or change) your voting instructions. If you use the telephone voting system, you do not need to return your proxy card.

3)

By Mail. Mark your voting instructions, sign and date the proxy card and then return it in the postage-paid envelope provided. If you mail your proxy card, we must receive it before 12:00 p.m., Eastern Time, on Friday, April 12, 2024. If you are returning your proxy card to Broadridge, they must receive it before 10:00 a.m., Eastern Time, on Wednesday, April 17, 2024, the day before the Annual Meeting.

4)

By Virtual Webcast. Attend the virtual Annual Meeting at www.virtualshareholdermeeting.com/HUM2024 and cast your vote using the webcast voting options. Be aware that you can vote by methods 1, 2 or 3 above prior to the meeting and still attend the Annual Meeting. In all cases, a vote at the Annual Meeting will revoke any prior votes. Please note that if your Shares are held through a bank, broker or other nominee, you will need to obtain your Control Number in order to vote.

How will my Shares be voted if I do not specify how they should be voted?

If you sign and return your proxy card without indicating how you want your Shares to be voted, the persons acting under the proxies will vote your Shares as follows:

FOR the election of each of the eleven (11) director nominees named in this proxy statement; and

FOR the ratification of the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for 2024; and

FOR the approval of the compensation of the Company’s Named Executive Officers as disclosed in this proxy statement; and

FOR the approval of the amendment to the Company’s Restated Certificate of Incorporation to limit the liability of certain officers of the Company as permitted by Delaware law; and

FOR the approval of the amendment to the Company’s Restated Certificate of Incorporation to eliminate supermajority voting requirement in connection with certain transactions; and

AGAINST the stockholder proposal set forth in this proxy statement, if properly presented at the meeting.

What if my Shares are not registered in my name?

If you own your Shares in “street name,” meaning that your bank, broker or other nominee is actually the record owner, you should receive the Notice and voting instruction card from your bank, broker or other nominee. In addition, stockholders may request, by calling Broadridge at 1-800-579-1639, to receive proxy materials in printed form, by mail or electronically by e-mail, on an ongoing basis. When you own your Shares in street name, you are deemed a beneficial owner or holder for voting purposes and you may not vote your Shares at the Annual Meeting unless you receive a valid proxy from your brokerage, firm, bank, broker-dealer or other nominee holder.

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If you hold Shares through an account with a bank, broker or other nominee and you do not provide voting instructions on your instruction form, your Shares may not be voted by the nominee with respect to certain proposals, including:

the election of directors;

the approval of the compensation of the Company’s Named Executive Officers as disclosed in this proxy statement;

the approval of the amendment to the Company’s Restated Certificate of Incorporation to limit the liability of certain officers of the Company as permitted by Delaware law;

the approval of the amendment to the Company’s Restated Certificate of Incorporation to eliminate supermajority voting requirement in connection with certain transactions;

the stockholder proposal set forth in this proxy statement.

Banks, brokers and other nominees have the authority under the regulations of the New York Stock Exchange, or the NYSE, to vote Shares for which their customers do not provide voting instructions only on certain “routine” matters, including the ratification of the appointment of the Company’s independent registered public accounting firm. However, the proposals listed above are not considered “routine” matters for this purpose, and therefore your Shares will not be voted with respect to such proposals if you do not provide voting instructions on your instruction form.

How many votes are required to approve each proposal, what are the effects of abstentions and unmarked proxy cards, and is broker discretionary voting allowed?

Proposal

Vote Required for

Approval

Effect of

 Abstentions 

Broker

 Discretionary 

Voting
Allowed
(2)

 Unmarked/Signed 

Proxy Cards

Election of directors

The number of votes
cast for a nominee

exceeds the number
of votes cast against
that nominee.
(1)

No effectNo

Voted “For”

All Directors

Ratification of the
appointment of the

independent registered

public accounting firm

Majority of the votes cast affirmatively or negatively on the proposal

No effectYesVoted “For”

Non-binding advisory vote

to approve executive

compensation

Majority of the votes cast affirmatively or negatively on the proposal

No effectNoVoted “For”

Amendment to the Company’s Restated Certificate of Incorporation to limit the liability of certain officers of the Company as permitted by Delaware law

Majority of outstanding shares entitled to voteCounted as “Against”NoVoted “For”

Amendment to the Company’s Restated Certificate of Incorporation to eliminate supermajority voting requirement in connection with certain transactions

Three-fourths (75%) of outstanding shares
entitled to vote

Counted as “Against”NoVoted “For”

Stockholder proposal as set forth in this proxy statement

Majority of the votes cast affirmatively or negatively on the proposal

No effectNoVoted “Against”

(1)

Under the Company’s Majority Vote Policy, following a director’s initial election to our Board of Directors, the director is required to submit his or her irrevocable resignation to our Board of Directors conditioned upon (a) the director not achieving the requisite

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stockholder vote at any future meeting at which he or she faces re-election, and (b) acceptance of the resignation by the Board of Directors following that election. The Board of Directors has 90 days after a director fails to achieve the requisite stockholder votes to determine whether or not to accept the director’s resignation and to report this information to our stockholders.
(2)

If you are a beneficial owner whose Shares are held of record by a broker or other NYSE member organization, you must instruct the broker how to vote your Shares. If you do not provide voting instructions, your Shares will not be voted on any proposal on which the broker does not have discretionary authority to vote. This is called a “broker non-vote.” A broker non-vote will not affect the outcome of the vote for the matters being presented for action at the Annual Meeting, because they are not considered to be votes cast.

What is a “broker non-vote”?

A broker non-vote occurs when a broker or other NYSE member organization holding Shares for a beneficial owner does not vote on a particular proposal because the nominee does not have discretionary voting power with respect to that item and has not received voting instructions from the beneficial owner but does have discretionary voting power over other items and submits votes for those matters. As discussed above, if you hold Shares through a broker or other NYSE member organization and do not provide voting instructions to your broker or other NYSE member organization, your Shares may not be voted with respect to certain proposals, including the proposals listed above that are not considered routine.

What is a “quorum”?

A “quorum” is a majority of the issued and outstanding Shares entitled to vote at the Annual Meeting. Shares may be voted at the Annual Meeting by a signed proxy card, by telephone instruction, or electronically on the Internet. There must be a quorum for the Annual Meeting to be held. Abstentions and broker non-votes are counted as present and entitled to vote for purposes of determining whether a quorum exists.

How do I vote the share equivalent units held in the Humana Common Stock Fund of the Humana Retirement Savings Plan or the Humana Puerto Rico Retirement Savings Plan?

If you have an interest in the Humana Common Stock Fund of the Humana Retirement Savings Plan or the Humana Puerto Rico Retirement Savings Plan on the Record Date, you may vote. Under the Humana Retirement Savings Plan and the Humana Puerto Rico Retirement Savings Plan, your voting rights are based on your interest, or the amount of money you and the Company have invested in your Humana Common Stock Fund.

You may exercise these voting rights in almost the same way that stockholders may vote their Shares, but you have an earlier deadline, and you should provide your voting instructions to Broadridge. Broadridge will aggregate the votes of all participants and provide voting information to the Trustee for the applicable plan. If your voting instructions are received by 11:59 p.m., Eastern Time, on Wednesday, April 10, 2024, the Trustee will submit a proxy that reflects your instructions. If you do not give voting instructions (or give them later than that time), the Trustee will vote your interest in the Humana Common Stock Fund in the same proportion as the Shares attributed to the Humana Retirement Savings Plan, or the Humana Puerto Rico Retirement Savings Plan, as applicable, are actually voted by the other participants in the applicable plan.

You must provide your instructions to Broadridge by using the Internet, registered holder telephone number (1-800-690-6903) or mail methods described above. Please note that you cannot vote during the Annual Meeting. Your voting instructions will be kept confidential under the terms of the Humana Retirement Savings Plan or the Humana Puerto Rico Retirement Savings Plan, as applicable.

Who will count the votes?

Broadridge will tabulate the votes cast by proxy, whether by proxy card, Internet or telephone. Additionally, the Company’s Inspectors of Election will tabulate the votes cast at the Annual Meeting together with the votes cast by proxy.

How do I change my vote or revoke my proxy?

You have the right to change your vote or revoke your proxy at any time before the Annual Meeting.

Your method of doing so will depend upon how you originally voted (a later vote will supersede any prior vote you made regardless of how that vote was made):

1)

Virtually — you may attend the virtual webcast of the Annual Meeting and submit your vote;

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2)

By Internet — simply log in and resubmit your vote — Broadridge will only count the last instructions;

3)

By Telephone — simply enter your Control Number and resubmit your vote — Broadridge will only count the last instructions; or

4)

By Mail — you must give written notice of revocation to Broadridge, 51 Mercedes Way, Edgewood, NY 11717, submit another properly signed proxy with a more recent date. For written notices you must include the Control Number that is printed on the upper portion of your proxy card.

What is the due date for stockholder proposals for the Company’s 2025 Annual Meeting?

Stockholders may present proposals for consideration at future Annual Meetings of Stockholders in accordance with the specific provisions in our Bylaws. Stockholder proposals as permitted by SEC Rule 14a-8 for inclusion in our proxy materials relating to the 2025 Annual Meeting, must be submitted to the Corporate Secretary in writing no later than November 8, 2024.

For a stockholder proposal other than a proposal in accordance with SEC Rule 14a-8 to be properly submitted for consideration at our 2025 Annual Meeting, our Corporate Secretary must receive the stockholder’s written notice of intention to submit the proposal at our corporate headquarters between 9:00 a.m. local time on December 19, 2024, and 5:00 p.m., local time, on January 18, 2025. If the date of our 2025 Annual Meeting is earlier than March 19, 2025 or later than June 17, 2025, for a stockholder proposal notice to be properly submitted for consideration at our 2025 Annual Meeting, our Corporate Secretary must receive the stockholder’s written proposal notice after 9:00 a.m., local time, on the 120th day before the date of our 2025 Annual Meeting and before 5:00 p.m., local time, on the 90th day before the date of our 2025 Annual Meeting. However, if we first publicly announce the date of our 2025 Annual Meeting less than 100 days before to the date of our 2025 Annual Meeting, the deadline for the submission of a written stockholder proposal notice will be 5:00 p.m., local time, on the 10th day following the day on which we first publicly announce the date of our 2025 Annual Meeting. A proposal must also meet other requirements as to form and content set forth in our Bylaws.

All proposals must be submitted to the attention of the Corporate Secretary, Humana Inc., 500 West Main Street, 21st Floor, Louisville, Kentucky 40202.

What is the due date for stockholder nominees for director for the Company’s 2025 Annual Meeting?

Under our Bylaws, for a stockholder director nomination to be properly submitted for consideration at our 2025 Annual Meeting (other than through our proxy access procedures described below), our Corporate Secretary must receive the stockholder’s written notice of nomination at our corporate headquarters between 9:00 a.m. local time on December 19, 2024, and 5:00 p.m., local time, on January 18, 2025. If the date of our 2025 Annual Meeting is earlier than March 19, 2025 or later than June 17, 2025, for a stockholder nomination to be properly submitted for consideration at our 2025 Annual Meeting, our Corporate Secretary must receive the stockholder’s written notice of nomination after 9:00 a.m., local time, on the 120th day before the date of our 2025 Annual Meeting and before 5:00 p.m., local time, on the 90th day before the date of our 2025 Annual Meeting. However, if we first publicly announce the date of our 2025 Annual Meeting less than 100 days before to the date of our 2025 Annual Meeting, the deadline for the submission of a written notice of nomination will be 5:00 p.m., local time, on the 10th day following the day on which we first publicly announce the date of our 2025. For a stockholder’s written notice of nomination to be properly submitted, it must comply with our Bylaws and include all of the information required by our Bylaws, including the nominee’s name, qualifications for Board membership and compliance with our Director Resignation Policy discussed in this proxy statement, and must be sent to the attention of the Corporate Secretary, Humana Inc., 500 West Main Street, 21st Floor, Louisville, Kentucky 40202.

In addition, our Bylaws provide for proxy access. One or more stockholder may nominate candidates for election to our Board of Directors and include those nominees in our 2025 proxy materials so long as the stockholder(s) and the nominee(s) satisfy the terms, conditions and requirements for proxy access specified in our Bylaws. The key parameters are:

Minimum Ownership Threshold: the nominating stockholder(s) must own 3% or more of the outstanding Shares;

Ownership Duration: those Shares must have been held continuously for at least three years;

Nominating Group Size: the nominating stockholder group cannot consist of more than 20 stockholders; and

Number of Nominees: appropriate stockholders may nominate the greater of 20% of the number of directors serving on the Board of Directors or 2 nominees.

Under our Bylaws, for a proxy access stockholder nomination to be properly submitted for inclusion in our 2025 proxy materials and consideration at our 2025 Annual Meeting, our Corporate Secretary must receive a written notice of the proxy access nomination at our

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corporate headquarters between October 9, 2024, and November 8, 2024. For the written notice of proxy access nomination to be properly submitted, it must comply with our Bylaws and include all of the information required by our Bylaws for proxy access, and must be sent to the attention of the Corporate Secretary, Humana Inc., 500 West Main Street, 21st Floor, Louisville, Kentucky 40202.

May a stockholder present a proposal not included in our Proxy Statement at the April 18, 2024, Annual Meeting?

A stockholder may not present a proposal at the Annual Meeting (a so-called “floor resolution”).

How will Humana solicit votes and who pays for the solicitation?

We have engaged D. F. King & Co., Inc. to assist in the distribution of proxy materials and solicitation of votes for approximately $15,000 plus expenses. We have also engaged Broadridge to assist in the distribution of proxy materials and the accumulation of votes through the Internet, telephone and coordination of mail votes for approximately $433,207 proxy and solicitation material to our stockholders.

How can I obtain additional information about the Company?

Included with this proxy statement (either in printed form or on the Internet) is a copy of our Annual Report on Form 10-K for the year ended December 31, 2023, which also contains the information required in our Annual Report to Stockholders. Our Annual Report on Form 10-K and all our other filings with the SEC also may be accessed via the Investor Relations section on our website at www.humana.com. We encourage you to visit our website. From www.humana.com click on “More Humana,” then click on “For Investors,” then click on the “SEC Filings and Financial Reports,” then click on the “Annual Reports” subcategory.

Where can I find voting results for this Annual Meeting?

The voting results will be published in a current report on Form 8-K which will be filed with the SEC no later than four business days after the Annual Meeting. The Form 8-K will also be available on our website. From the www.humana.com website, click on “More Humana,” then click on “For Investors,” then click on “SEC Filings and Financial Reports,” and then click on “SEC Filings” subcategory.

What is “householding”?

“Householding” occurs when a single copy of our Annual Report, proxy statement and Notice is sent to any household at which two or more stockholders reside if they appear to be members of the same family. Although we do not “household” for registered stockholders, a number of brokerage firms have instituted householding for Shares held in street name. This procedure reduces our printing and mailing costs and fees. Stockholders who participate in householding will continue to receive separate proxy cards, and householding will not affect the mailing of account statements or special notices in any way. If you wish to receive separate copies of our Annual Report, proxy statement or Notice in the future, please contact the bank, broker or other nominee through which you hold your Shares.

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Incorporation by Reference

 

The Organization & Compensation Committee Report and the Audit Committee Report (including the reference to the independence and financial expertise of the Audit Committee members), each contained in this proxy statement, are not deemed filed with the SEC and shall not be deemed incorporated by reference into any prior or future filings made by Humana under the Securities Act of 1933, except to the extent that we specifically incorporate such information by reference into any of these future filings.

Additional Information

 

Our Annual Report on Form 10-K for the year ended December 31, 2021,2023, excluding certain of its exhibits, is included with the transmittal of this proxy statement. We will provide a copy without charge to anyone who makes a written request to Humana Inc., Investor Relations Department, 500 West Main Street, Louisville, KY 40202.

Our Annual Report on Form 10-K and all other filings with the SEC may also be accessed via the Investor Relations page on our website at www.humana.com. From the www.humana.com website, click on “Investor Relations,“More Humana,” then click on “For Investors,” and then click on the report you wish to review under the “SEC Filings and Financial Reports” subcategory.

By Order of the Board of Directors,

 

 

LOGO

Joseph M. Ruschell

Associate Vice President, AssistantAssociate General Counsel &

Corporate Secretary

 

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Annex I

TENTH: A director of the corporation shall not be personally liable to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director except for liability (i) for any breach of the director’s duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the Delaware General Corporation Law, or (iv) for any transaction from which the director derived an improper personal benefit.

An officer of the corporation shall not be personally liable to the corporation or its stockholders for monetary damages for breach of fiduciary duty as an officer except for liability (i) for any breach of the officer’s duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) for any transaction from which the officer derived an improper personal benefit, or (iv) in any action by or in the right of the corporation.

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   A-I-1


Annex II

ELEVENTH: Except as otherwise set forth elsewhere in this Eleventh Article the affirmative vote of three-fourths of the outstanding shares entitled to vote thereon shall be required: (a) for the adoption of any agreement for the merger or consolidation of the corporation with or into a related company or an affiliate of a related company, (b) to authorize the sale or lease of all or substantially all of the assets of the corporation to a related company or affiliate of a related company, or (c) to authorize the sale or lease to the corporation or any subsidiary of any assets of a related company or an affiliate of a related company in exchange for equity securities of the corporation.

A determination of the Board of Directors of the corporation, based on information known to the Board of Directors and made in good faith, shall be conclusive as to whether a company, person or other entity is a related company, an affiliate or an associate and whether a related person or affiliate thereof beneficially owns more than 5% of any class of equity securities of the corporation.

The provisions of this Article Eleventh shall not be applicable to any (i) merger or consolidation of the corporation with or into a related person or an affiliate thereof, (ii) sale or lease of all or any substantial part of the assets of the corporation to a related person or affiliate thereof, or (iii) sale or lease of any assets of a related person or affiliate thereof to the corporation or any subsidiary in exchange for equity securities of the corporation, if the Board of Directors of the corporation shall have approved such a transaction with such related company or affiliate prior to the time that such related company or affiliate became a holder of more than 5% of any class of equity securities of the corporation.

The provisions of this Eleventh Article shall be in addition to the requirements of the Delaware Corporation Law and shall not be amended or repealed without the affirmative vote of three-fourths of the outstanding stock of the corporation entitled to vote thereon.

For purposes of this Eleventh Article a “related company” in respect of a given transaction is any company, person or other entity which by itself or together with its affiliates and associates is the beneficial owner, directly or indirectly, of more than 5% of any class of equity securities of the corporation as of the record date for the determination of stockholders entitled to vote on such transactions. An “affiliate” of a related company is any company, person or other entity which, directly or indirectly, through one or more intermediaries, controls or is controlled by, or is under common control with, the related company. An “associate” of a related company is any officer, director or beneficial owner, directly or indirectly, of 5% or more of any class of equity securities of such related company or any of its affiliates. “Equity security” is any stock or similar security, or any security, convertible, with or without consideration, into such a security, or carrying any warranty to subscribe to or purchase such a security, or any such warrant or right.

A related company shall be deemed to be the beneficial owner of any equity securities which it or its affiliates or associates has the right to acquire pursuant to any agreement or which are beneficially owned, directly or indirectly, by any other company, person or entity (or an affiliate or associate of such company, person or entity) with which it or its affiliates or associates has any agreement, arrangement or understanding for the purpose of acquiring, holding, voting or disposing of any equity securities of the corporation.

A-II-1

Humana | 20222024 Proxy Statement Incorporation by ReferenceAnnex II

 


Annex III

Reconciliation of Non-GAAP Financial Measure

We have included an Adjusted EPS financial measure (not in accordance with Generally Accepted Accounting Principles (GAAP)) in our proxy statement as we believe that this measure, when presented in conjunction with the corresponding GAAP measure, provides a comprehensive perspective to more accurately compare and analyze our core operating performance over time. Consequently, management uses this non-GAAP (Adjusted) financial measure as a consistent and uniform indicator of the Company’s core business operations from period to period, as well as for planning and decision-making purposes and in determination of incentive compensation. The non-GAAP (Adjusted) financial measure should be considered in addition to, but not as a substitute for, or superior to, financial measures prepared in accordance with GAAP. We encourage each stockholder to read the full financial analysis for year ended December 31, 2023 contained in our Annual Report on Form 10-K, filed with the SEC on February 15, 2024.

  

Diluted Earnings Per Common Share (EPS) (unaudited)

  FY 2023   FY 2022 
  

GAAP

  $20.00   $22.08 
  

Amortization associated with identifiable intangibles

   0.54    0.64 
  

Put/call valuation adjustments associated with company’s non-consolidating minority interest investments

   2.57    0.53 
  

Transaction and integration costs

   (0.38   0.83 
  

Change in fair market value of publicly-traded equity securities

   (0.01   0.97 
  

Impact of exit of employer group commercial medical products business

   0.13    0.84 
  

Accrued charge related to certain anticipated litigation expenses

   0.84    —  
  

Value creation initiatives

   3.50    3.72 
  

Impairment charges

   0.73    —  
  

Gain on the sale of Gentiva (formerly Kindred) Hospice

   —     (1.86
  

Cumulative net tax impact of non-GAAP adjustments

   (1.83   (1.87
  

Adjusted (non-GAAP)

  $26.09   $25.88 

The following items are excluded from the Adjusted (non-GAAP) EPS disclosure as noted above:

Amortization associated with identifiable intangibles — Since amortization varies based on the size and timing of acquisition activity, management believes this exclusion provides a more consistent and uniform indicator of performance from period to period.

Put/call valuation adjustments associated with company’s non-consolidating minority interest investments — These amounts are the result of fair value measurements associated with the company’s Primary Care Organization strategic partnership and are unrelated to the company’s core business operations.

Transaction and integration costs — The transaction and integration costs primarily relate to the acquisition of Kindred at Home in 2021 and the subsequent divestiture of Gentiva (formerly Kindred) Hospice in 2022.

Change in fair value of publicly-traded equity securities — These gains and losses are a result of market and economic conditions that are unrelated to the company’s core business operations.

Impact of exit of employer group commercial medical products business — Prior period segment financial information has been recast to exclude the impact of the exit of the employer group commercial medical products business as announced by Humana on February 23, 2023.

Accrued charge related to certain anticipated litigation expenses — This charge relates to certain anticipated expenses the company has accrued in connection with a legal matter.

Value creation initiatives — These charges relate to the company’s ongoing initiative to drive additional value for the enterprise through cost saving, productivity initiatives, and value creation from previous investments, and primarily consist of asset impairment and severance charges.

Impairment charges — The company recognized non-cash impairment charges in 4Q23 related to (1) certain indefinite-lived intangible assets based on the company’s estimate of future financial performance in certain state markets and (2) investments in certain joint ventures for which the company held minority ownership interests that were deemed to be unrecoverable based on recent market activity.

Gain on sale of Gentiva (formerly Kindred) Hospice — Reflects gain related to the sale of the company’s 60 percent ownership of Gentiva (formerly Kindred) Hospice.

Cumulative net tax impact of non-GAAP adjustments — This adjustment represents the cumulative net impact of the corresponding tax benefit or expense related to the aforementioned items excluded from the applicable GAAP measures.

Annex III 2024 Proxy Statement | Humana

A-III-1


 

  

HUMANA INC.

500 WEST MAIN STREET

21STFLOOR

LOUISVILLE, KY 40202

ATTN: JOSEPH M. RUSCHELL

  

 LOGO

LOGO

 

YOUR VOTE IS IMPORTANT

VOTE BY TELEPHONE OR INTERNET OR MAIL

VOTE BY INTERNET

Before The Meeting - Go to www.proxyvote.com or scan the QR Barcode above

Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 P.M.p.m. Eastern Time on April 20, 2022.17, 2024. Have your proxy card in hand when you access the websiteweb site and follow the instructions to obtain your records and to create an electronic voting instruction form.

ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS

If you would likeDuring The Meeting - Go to reducewww.virtualshareholdermeeting.com/HUM2024

You may attend the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronicallymeeting viae-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and when prompted, indicatevote during the meeting. Have the information that you agree to receive or access proxy materials electronicallyis printed in future years.the box marked by the arrow available and follow the instructions.

VOTE BY PHONE - 1-800-690-6903

Use any touch-tone telephone to transmit your voting instructions up until 11:59 P.M.p.m. Eastern Time on April 20, 2022.17, 2024. Have your proxy card in hand when you call and then follow the instructions.

VOTE BY MAIL

Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Humana Inc.,Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. PLEASE DO NOT MAIL BACK YOUR PROXY CARD IF YOU ARE VOTING BY TELEPHONE OR THE INTERNET.

 

TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:  
  D67745-P66007              V30283-P02701     KEEP THIS PORTION FOR YOUR RECORDS
— — — — — ——

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DETACH AND RETURN THIS PORTION ONLY

THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.

 

 

 HUMANA INC.            

 

  The Board of Directors recommends you vote FOR

  proposals 1, 2, 3, 4 and 3:5:

     
    Vote on Directors

1.  Election of Directors

  
 Nominees: For  Against  Abstain     
 Nominees: For AgainstAbstain
 

1a) Raquel C. Bono,C.Bono, M.D.

ForAgainstAbstain

1b) Bruce D. Broussard

1c)    Frank A. D’Amelio

1d)    David T. Feinberg, M.D.

1e)    Wayne A. I. Frederick, M.D.

1f)     John W. Garratt

1g)    Kurt J. Hilzinger

1h)    David A. Jones, Jr.

1i)     Karen W. Katz

 

  

  

  

      1j)     Marcy S. Klevorn

      1k)    William J. McDonald

      1l)     Jorge S. Mesquita

      1m)   James J. O’Brien

For

Against

Abstain

 

2.  The ratification of the appointment of Pricewater-houseCoopers LLP as the Company’s independent registered public accounting firm.

 

 

 1c)  Frank A. D’Amelio

 1d) David T. Feinberg, M.D.

3.  Non-binding advisory vote for the approval of the compensation of the named executive officers as disclosed in the 20222024 proxy statement.

 

 

 

 

 1e) Wayne A. I. Frederick, M.D.

 1f)   John W. Garratt

4.  The approval of the amendment to the Company’s Restated Certificate of Incorporation to limit the liability of certain officers of the Company as permitted by Delaware law.

 1g) Kurt J. Hilzinger

 1h) Karen W. Katz

5.  The approval of the amendment to the Company’s Restated Certificate of Incorporation to eliminate supermajority voting requirement in connection with certain transactions.

 1i)   Marcy S. Klevorn

 1j)   Jorge S. Mesquita

The Board of Directors recommends you vote AGAINST on proposal 6:ForAgainstAbstain

 1k)  Brad D. Smith

6.  The stockholder proposal on simple majority vote, if properly presented at the meeting.

For address changes and/or comments, please send via email to: CorporateSecretary@humana.com.

     

At their discretion, the Proxies are authorized to vote upon any other matters as may come before the Annual Meeting.

    

Signatures of stockholders should correspond exactly with the names shown on this proxy card. Attorneys, trustees, executors, administrators, guardians and others signing in a representative capacity should designate their full titles. When shares of Company Common Stock are held by joint tenants, both should sign. If a corporation, please sign in full corporate name by authorized officer. If a partnership, please sign in partnership name by an authorized person.

 

 

 

   

Signature [PLEASE SIGN WITHIN BOX]

Date

         

Signature (Joint Owners)

  

Date

  Signature [PLEASE SIGN WITHIN BOX]DateSignature (Joint Owners)Date

 


Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:

The Notice and Proxy Statement and Annual Report are available at www.proxyvote.com.

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D67746-P66007V30284-P02701  

 

 

HUMANA INC.

ANNUAL MEETING OF STOCKHOLDERS

THURSDAY, APRIL 21, 202218, 2024

9:30 AM,1:00 PM, EASTERN TIME

Corporate Headquarters

500 West Main Street

Louisville, Kentucky 40202
PROXY SOLICITED BY THE BOARD OF DIRECTORS

FOR 20222024 ANNUAL MEETING OF STOCKHOLDERS

The undersigned hereby appoints Kurt J. Hilzinger and Bruce D. Broussard, and each of them, their attorneys and agents, with full power of substitution to vote as Proxy for the undersigned, as herein stated, at the Annual Meeting of Stockholders of Humana Inc. (the Annual Meeting) to be held at the Company’s headquarters at 500 West Main Street, Louisville, Kentucky 40202, on Thursday, the 2118st thday of April, 20222024 at 9:30 a.m.1:00 p.m., Eastern Time, via live audio webcast atwww.virtualshareholdermeeting.com/HUM2024, and at any postponements or adjournments thereof, according to the number of votes the undersigned would be entitled to vote on the proposals as set forth on the reverse side if personally present.

THE SHARES OF COMMON STOCK COVERED BY THIS PROXY WILL BE VOTED AS SPECIFIED. IF NO SPECIFICATION IS MADE, THE PROXY WILL BE VOTED IN FAVOR OF THE ELECTION OF DIRECTORS, FOR THE RATIFICATION OF PRICEWATERHOUSECOOPERS LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM, AND FOR THE APPROVAL OF THE COMPENSATION OF THE NAMED EXECUTIVE OFFICERS AS DISCLOSED IN THISTHE PROXY STATEMENT, FOR THE APPROVAL OF THE AMENDMENT TO THE COMPANY’S RESTATED CERTIFICATE OF INCORPORATION TO LIMIT THE LIABILITY OF CERTAIN OFFICERS OF THE COMPANY AS PERMITTED BY DELAWARE LAW, FOR THE APPROVAL OF THE AMENDMENT TO THE COMPANY’S RESTATED CERTIFICATE OF INCORPORATION TO ELIMINATE SUPERMAJORITY VOTING REQUIREMENT IN CONNECTION WITH CERTAIN TRANSACTIONS, AND AGAINST THE STOCKHOLDER PROPOSAL AS SET FORTH IN THE PROXY STATEMENT. THE UNDERSIGNED HEREBY REVOKES ANY PROXY HERETOFORE GIVEN TO VOTE OR ACT WITH RESPECT TO THE ANNUAL MEETING.

(SEE REVERSE SIDE TO VOTE)